Trades – December No-Cost Dividend Growth Portfolio Purchases

December No-Cost Dividend Growth Portfolio Purchases - Snow Scape

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.

December No-Cost Dividend Growth Portfolio Purchses - Table of Activity

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

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Comments

  1. Thanks for sharing your L3 purchases. If I was starting out today L3 would be my first choice among the online brokers. Anytime you can add shares in real deal companies for $0 commish you should take advantage of it. Happy to see some VFC added to your portfolio. It’s really not that popular among the DGI bloggers and I’m not really sure why. I have owned it for many, many years and would love to buy a lot more of it but not at current price/valuation. Like the VFC trade and UL!

    • Happy to be a fellow shareholder in a couple of these companies DivHut. VFC is certainly not cheap, but is a company I’d like to own as well. By DRIPing into it slowly, I’ll be able to catch some of the fluctuations in price and build a position slowly. I believe the lack of price value is why it isn’t as popular with dividend bloggers.

      Thanks for stopping by and commenting.

  2. roadmap2retire says:

    Solid companies in that list there, W2R. Congrats on adding them and building your dividend growth portfolio.

    cheers
    R2R

  3. The other benefit of Loyal3 afforded by commission free investing is that you can invest small amounts regularly, thereby dollar cost averaging into a holding. I pointed this out to my sons, who now are Loyal3 investors. Whereas with DivGro I look for stocks trading at a discount to fair value, it is not so important for them to buy at a discount, since they’re buying a fixed dollar amount of the same stock every month.

    • Couldn’t agree more. Your three sons are in a great position to leverage this as the contribute small amounts of capital. As for someone like me, it provides a great compliment to traditional larger purchases by allowing me a means to DCA into stocks that aren’t particularly well-valued but are desirable for my portfolio.

      Thanks for stopping by and commenting.

      • Mmm… perhaps I should consider a small Loyal3 account for a few dividend growth stocks that are too expensive to buy, like KO.

        • That’s where I am headed with the account myself. Companies like SBUX and VFC are almost always overvalued, so being able DRIP into a position without being as concerned about on particular month’s price is pretty valuable. Be sure to let us know if you end up going that route.

  4. Have you looked in to the new Robinhood app available for Apple users? Zero commission, no minimums or fees and real time limit order trading. All US based companies available.

    • Chris, I agree, Robinhood has the potential to be great, but I see two problems for me in particular:

      1) I do not have an iPhone or other Apple product that would meet the current app requirements. As a result, until a web interface is created, I’m not interested
      2) Longevity concerns due to a lack of solid revenue streams. The type of investor Robinhood is targeting is not the type of investor to load up on margin, in turn generating revenue to support the platform. Given the lack of other revenue streams, I see Robinhood having some issues monetizing those utilizing the platform to be able to support to costs of supporting those same users. Loyal3 has two separate revenue streams, neither of which are dependent on the number of consumers on the platform. Additionally, due to batch trading, their underlying costs will be less per account.

      Once Robinhood has a web based interface, I will definitely check them out, but until then they are much too limited in both current offerings and long-term prospects.

      Thanks for stopping by and for reading, much appreciated!

  5. Solid buys on some very great companies. Loyal3 is a great way to build up your portfolio over time with small purchases that cost you no commission fee.

  6. W2R,

    Nice companies up there. Starbucks is one I want to get a piece of at some point here.

    Keep it rolling!!

    Best regards.

    • Absolutely – as a maturing company that isn’t as focused on growth, they should ideally turn into a nice cash cow, similar to a McDonalds (hopefully!).

      DM, as always, love the thoughts and you stopping by.

  7. Definitely some solid companies in there man. I agree with the above, that Loyal3 is still a great platform to begin with. I only wish we had something like it in the UK, although we do have something called ‘regular investing’ with certain brokers that allow you to buy stocks for £1.50 (roughly $2.25) which is certainly an attractively priced offer.

    Best Wishes for 2015,

    M

    • Solid companies and regular steady investing will help build some nice sized positions that should allow for some accelerated growth down the road. I like the concept of ‘regular investing’ companies that offer discounted trades. How frequently and in what pound amount do you have to invest in to obtain that pricing?

      Best wishes to you as well in this New Year.

  8. Hi W2R,

    I’m new to the blogging world although I have been reading them for years now. Just wanted to stop by and say you’ve got a nice batch of companies in your portfolio and your future self will be quite pleased with your present self. I look forward to reading more of your updates in the future, good luck in 2015!

    ADD

    • Welcome to the blogging world ADD. Always good to have another entrant to the community. You look like you’ve got a great portfolio started and should be in good shape to continue snowballing into bigger and better things.

      Thanks for reading and best of luck yourself in 2015!

  9. Hi, W2R.
    Thanks for the refresher on Loyal3. I have used the site this past year to build a position in BUD. It’s a bit of a fringe stock, but I figure that now I can classify every Black Crown I drink as a form of market research or due diligence. Congrats on putting over $6K to work in Loyal3 in 2014! You really knocked it out of the park. Best wishes.

    Goosemann Jones
    Flight to Dividends Blog

    • BUD, definitely not the standard DG pick, but as long as you’re happy, that’s what matters. I think the same thing about UL, MCD, KO, PEP, WMT, TGT and more as I either consumer or buy products they produce or sell. Lining my own pockets in the regular course of life.

      I’m happy to have been able to build such a nice “side” portfolio, and have plans on leveraging the no-cost nature to dollar cost average into some positions that aren’t necessarily ever going to be a “fair value”.

      Thanks for your thoughts and stopping by Goosemann.

  10. I like Loyal3 as well. I use it to complement my Roth IRA.

  11. So how are the orders handled at Loyal3? I think I saw you mentioned they were batched, so does that mean that you can’t submit live or realtime market/limit orders? Are they all processed at the end of the day? Does Loyal3 have options on their platform? I like to do covered calls against dividend paying stocks to enhance the dividend and sell puts at lower prices as a way to dollar cost average.

    I have really low commissions like penny per share with a $1 minimum. So a 100 shares only cost me $1 commission. And options I pay a $0.75 commission per contract with no minimums.

    Anyone using the Loyal3 platform for covered calls?

    Cheers!

    • You’re correct, there are no real-time or market orders. In addition, no options trading as well. It is really a bare-bones, no-cost environment that happens to house a few great names for dividend growth investors. You are already in a position where you are paying extremely low trading costs, so I would likely stick with that for the bulk of your trading and investing given your needs.

      Thanks for commenting and stopping by GYFG.

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