Monday, April 28, 2014
Weekly Purchase - ABT & BP
4 shares BP, 4.65% yield, $9.12
Even though its stock price crept up the past month, I still think BP plc looks attractive with a 10.0 forward p/e. I wish more dividend growth stocks traded at valuations that cheap! The second purchase was Abbott Laboratories with a most reasonable 15.6 forward p/e. This month my plan was to increase underweight positions, that's why I've been adding to ABT, BP, and GE fairly regularly. Moving forward, balancing my portfolio will take preference. That will include starting new positions, and also adding to holdings that have a dividend weight less than 1.5% (when valuations make sense). Since I don't want to fund a retirement with the 4% rule I decided it would be appropriate to weight my holdings based on income instead of market value. Ideally core stocks might have 3-4% weightings; supporting stocks 1.5-2%.
Please note that I have free trades available and did not pay commissions today. Under normal circumstances I try to buy in lots of at least $1,000 so as to minimize the effect of commissions/fees.