April 2014 report
It was another up month on the markets with the S&P and Dow up 2/3 % and 3/4 % respectively. The Dow and S&P have now recovered all of the January losses. The TSX had a good month of over 2% bringing the year to date to a 7 1/2 % gain.
My Portfolio is up between 2% and 3% for the month with a YTD of just over 8%.
Here is my stocks and their YTD gains and losses.
Although I use a buy and hold strategy, the average age of the stocks in my portfolio is only 3.42 years. That is because I am adding to the holdings regularly and purging when necessary. Of these stocks that I hold, the average annual return has been 11.65% plus dividends of between 3 and 4 %. What drags down my overall portfolio return is the cash that sits idle awaiting buying opportunities.
Going back and doing a thorough analysis of my historical purchases and sales over the last 10 years, my average return on the stocks that I have sold was 4.45% (weighted by amounts) plus dividends of over 3%. The reason I sold them was they no longer fit the criteria (as it evolved) or were losers (eg BP after the oil spill in the Gulf of Mexico).
Here are the stocks I have bought and sold over the past 10 years:
Some of them provided excellent returns (eg ITYBY and EONGY) while others were big losers (eg C, BP). Most of them provided an adequate return but no longer fit my evolving strategy.
Sell in May?
It’s that time of year again. With a buy and hold strategy, I would not advocate a complete purge of any portfolio. However if there are stocks that you want to cull out of your portfolio, this is a good a time as any to take the current profits and convert to cash to await a later buying opportunity. With the continuous run-up in the market, we are still long overdue for a real correction. It looked like we were having one late last year, but it wasn’t enough of a drop to call it a correction. We are heading into the summer doldrums and it is probably not a good time to buy, but there still may be a few good buys out there.
Here are some articles that talk about the “Sell in May” philosophy.
Below are links to investing articles that you might find interesting:
More Investing Articles
The twenty- and thirtysomethings of Generation Y who are entering the market today are in for worse treatment. A mindset for those who choose to buy a house: It’s about lifestyle, not making an investment.
And other articles on housing:
Articles looking at international stocks (see my commentary from last month)
Here is the current suggested stock list:
|Company||Ticker||Dividend Yield||Dividend Growth 10-Year||Current PE Ratio|
|Automatic Data Proc.||ADP||2.58||13.50||24.17|
|Baxter Int’l Inc.||BAX||2.71||8.50||14.43|
|Deere & Co.||DE||2.17||13.00||11.05|
|Exxon Mobil Corp.||XOM||2.64||8.50||12.97|
|Int’l Business Mach.||IBM||2.10||19.00||11.73|
|Johnson & Johnson||JNJ||2.64||12.50||17.57|
|Merck & Co.||MRK||3.06||1.50||17.02|
|Novartis AG ADR||NVS||3.22||16.00||21.52|
|Procter & Gamble||PG||3.17||11.00||18.66|
|Royal Dutch Shell ‘A’||RDS/A||4.96||7.50||13.36|
|Unilever PLC ADR||UL||3.35||9.00||19.21|