December marked the first month of the new Loyal3, and the change in the value proposition that it offers investors. After the marketing hook of offering funding through credit cards was ended, many folks questioned the ongoing proposition of investing with Loyal3. Without a question, for both dividend growth and non-dividend growth investors, opportunity still exists. It is these opportunities that I will continue to leverage for the foreseeable future.
What are these opportunities? Well for both types of investors, the primary value proposition of Loyal3 is the free trades with as little as $10 per investment. Period. No fees, no cost, every time. Of course, this is only possible with Loyal3 generating revenue through social stock programs and assisting with IPOs. Given the list of stocks offered is still relatively small, 64 as of today, there are still some offerings to interest both groups. Looking for a growth stock, well BABA, BRK.B, GOOG, and AMZN might you’re your fancy. For dividend growth investors, there are over twenty different options in which to invest. Some classic consumer goods DG positions can be found such as KO, PEP, UL, and WMT.
And all of this doesn’t include those really looking for something special. While obviously a bit of speculation, Loyal3 allows regular investors like you and I to participate in an IPO as if you were one of the big guys. Pretty neat! Simply sign-up to receive an email when they are about to have an IPO and get the opportunity to invest before the rest of the world.
So with Loyal3 still offering plenty to investors, even those like myself with a dividend growth focus, there is nothing left to do but keep on building that passive income stream. Going forward, my primary focus is to leverage the fee free ability to dollar cost average into some great companies. This will be reflected in the consistency of these updates going forward. Should they become redundant, I’ll combine them with my passive income updates. However, since we aren’t there yet, let’s take a look at my actual December purchases where I invested a total of $380.
December Loyal3 Trades
Because of the number of positions, I thought it would be easier to present as a chart. Below you will find the overall totals for each position and related purchase information.
Of the purchases above, three represent new positions in my Loyal3 portfolio, Apple, Disney, and VF Corporation. Each represents a slightly different opportunity for my account, by and large, these three companies are low yielding but high dividend growth companies. Given the overall high yield of my portfolio, looking towards some more growth oriented payers is something I’m looking towards moving forward with this portfolio. Between the three just mentioned and SBUX, I’ve begun the process of realizing that objective, and will continue to do so over the next year. One other company I’m considering that is similar in nature is NKE.
McDonalds dropped below my cost basis giving me a chance to average down slightly on my existing position. I’d like to add a bit more to this holding to build it up slightly. As of now, it sits just under $1,100 of contributed capital. Unilever is the classic defensive consumer staple company. Given the depth and width of their product lines, I’m going to continue to build this into one of the several cornerstones of my portfolio.
2014 Loyal3 Purchase Summary
Before looking at 2014 as a whole, I’d like to note that as with my previous transactions, these took zero to three business days to process from the time I put the order in till the time the transactions occurred. The variability depended on where the cash was when the order processed and the time of the order. If you have available cash from dividends or transferred cash, you can have a same day purchase if the order is placed prior to 2:00 pm. Otherwise, Loyal3 will initiate a transfer and the processing time varies slightly be the time in which the purchase is initialized. Either way, within two to three days, these transactions will close.
As you can see in the chart above, December’s purchases resulted in a total increase of $8.27 to my forward 12-month dividends and carried an overall average yield on cost of 2.18%. As I mentioned before, this is well below the average yield of the portfolio, but offers greater long-term growth and greater increases to my dividend income.
At the start of 2014, I decided to build a portfolio with Loyal3 by contributed small amounts of capital. Small contributions certainly add up though! As of the end of the year, I contributed a total of $6,239.97 into my Loyal3 portfolio. This amount includes most of the dividends received, $71.81 for 2014, combined with fresh capital. Containing 13 different positions, my Loyal3 portfolio has a forward 12-month dividend total of $213.38. Amazing the power of regular investing. In just 12-months, this “side” portfolio has grown to be its own dividend producing machine. Going forward I would anticipate doubling the size of the portfolio in 2015, at which point it will really begin to take a life of its own, contributing several hundred dollars each year to its own cause.
The full details of this portfolio can be seen on my Dividend Growth Portfolio page. If you’re interested in seeing what dividends this portfolio actually generated in 2014, check out my Dividend Calendar.
Go check out Loyal3 and let me know what you think.
What do you think of these purchases and my ongoing strategy of using Loyal3 as a dollar-cost averaging tool?
Flickr: manolo guijarro