Comments on: Trades – Sold BP PLC (BP) and Purchased Kinder Morgan, Inc. (KMI)

By: writing2reality

writing2reality — Sun, 17 Nov 2013 13:25:26 +0000

With Kinder, I am attracted to the much higher incentive distribution rights (IDR) that KMI receives from each of the partnership, ensuring that every little increase in distributions is maximized at the highest level. Additionally, since this purchase is housed in my Roth IRA account, the taxable benefits of owning an MLP are marginalized in an already tax-efficient account.

Thanks for the question!

By: Sumflow

Sumflow — Sun, 17 Nov 2013 07:00:21 +0000

If you are reinvesting dividends from the Kinder pipelines, why aren’t you using the higher yielding Kinder securities?

By: Mid Week Money: Correction Edition

Mid Week Money: Correction Edition — Wed, 05 Jun 2013 02:37:13 +0000

[…] Write your own reality mentioned his trade out of BP into Kinder Morgan given an inability to DRIP BP. Automatic dividend reinvestment can be a great way to grow dividend income fast. Its what I did when I first started and can make a material difference to dividend income over time. […]

By: Integrator

Integrator — Sun, 02 Jun 2013 12:53:35 +0000

W2R, Shame about the BP investment, but understand the reason for the trade. I used to DRIP my investments for the first 4-5 years, before doing more selective reinvestment. I personally think BP still represents good value, the high yield reinvested across some other positions can accrue dividend income quickly.

By: writing2reality

writing2reality — Thu, 30 May 2013 14:57:14 +0000

JC, you are absolutely right that adding capital is the key to this process. Because I am spread with a few different investments, some not covered on this blog, I won’t be adding capital as quickly as I might like for tracking purposes. With that in mind, for me it is better to keep up the direct reinvestments. As far as the high yielders go, I am planning on moving some of my PSEC investment into other avenues as it obviously will gain portfolio share quite quickly.

Thanks for stopping by JC!

By: JC @ Passive Income Pursuit

JC @ Passive Income Pursuit — Wed, 29 May 2013 21:46:45 +0000

You’ve got to do what’s right for you because you’re the only one that has to deal with your investment goals. I wouldn’t be too worried about not being able to reinvest dividends even at this early stage of your portfolio. As long as you’re having fresh capital to invest on a monthly basis then it will have the same effect. Plus reinvesting dividends into higher yielders can quickly throw the weighting out of whack. I’ve turned the DRIP off for a few positions and will eventually turn if off for all save for the KO, PG, JNJ… companies.