Tuesday, May 16, 2017

Dividend Income Updates - Q2 FY2017

It's the time of the year again where I try to tabulate all the dividend income received in the quarter and see where I stand in terms of passive income cashflow.

I am terming it as passive income because it's the closest to passive as I can get. Naturally it means having the management takes good care of the company and then we reap in the rewards as a shareholders of what's left in the profits.

The theme of this post will be based on my understanding of the advantage of dividend investing and that is to compound dividends for as early as we can, for as long as we live.

I wrote about this theme not too long ago which you can refer here.




I am sure by now many of you have heard the common saying of “Sell in May and Go Away” phenomenon that has been going around, lurking and prompting investors to sell their portfolio holdings and seek a hideout until the bear comes out.

While there are some truth in this, do note that they are not bound for absolute certainty given how some years they’ve turned out otherwise. They are noises to stir around the emotion of an individual, to test and see if they are investors who have a developed mind of their own or simply buying and selling based on what they heard on the street.

Now, if you decide to sell them based on the above reason, you will soon find yourself to be in an extremely difficult position to allocate the capital you have at hand as you have to find a better company with a better valuation, which does not come across too often. I’ve shared in my previous post (Link Here) how difficult it can be for an individual to sell and buyback and unless you’re a proven winner in this category, you are better off compounding those dividends you receive from your company as much, as early and as long as you can. I think that’s a slower but a pretty high success rate in the long term.

Ideally, I hope this will one day overtake what I am earning from my active income so it'll give me a peace of mind financially towards having more option on what I can do with my money and life.

Without further ado, here is the dividend income received in the 2nd Quarter of 2017.


CountersAmount (S$)Payable Date
Fraser Logistics Trust2,792.00 23-Jun
M11,180.00 28-Apr
LMIRT712.00 30-May
Comfortdelgro666.00 15-May
Fraser Comm Trust (scrip)501.00 30-May
First Reit174.00 26-May
Far East Hospitality Trust372.00 27-Jun
Elec & Eltek1,260.00 26-May
OCBC6.00 5-Jun
Total 7,663.00

That's a decent $7,663 of dividend income received in the second quarter which will give a big boost to the cashflow.

The amount drops slightly from previous year due to my undertaking of more Reits which gives out quarterly dividend so this will bump up the next 2 quarters.




I am treating this dividend income as part of my cashflow which would be reinvested into the market that will give me a higher dividend income in the future and this continues to compound for as long as I can afford to.

If you think that this strategy interests you, do give it a try for at least one year and then check back how it is. I think it’s a pretty addictive exercise to try out.


16 comments:

  1. Base on current dividend received, what's the return like on your capital invested? I'm using this strategy as well and believes that if after curating our counters and the returns are lower than the STI ETF, might as well just do index investing.

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    Replies
    1. Hi Scopion

      Are you asking for the portfolio yield?

      My guestimate is mine around 6% since I have some quite high yielding companies.

      I think comparing against the ETF has got to be a reasonable number of years and not just one particular year. I do still like knick picking and understanding companies so it's not totally just about the mathematics return per se.

      Delete
    2. Yes, portfolio yield. I'm hovering between 5-6% for mine. I was beginning to think about what to benchmark against so my current check is against the STI ETF. Perhaps I'm slightly more inclined to the returns to effort.

      Delete
  2. Impressive quarterly passive income, B! And congrats on featuring in Strait Times. Very insightful sharing indeed.

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  3. Is Not passive investing but i would term this as Passive Income considering we do not run those companies. People tends to confuse their use I feel. Great work there but i admire your timing trades more !

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    Replies
    1. Thanks Cory.

      Indeed passive investing is more suited for index investing that doesn't need much monitoring and rebalancing. Should have changed the term :)

      Delete
  4. solid Qtr passive income. Thanks for sharing

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    Replies
    1. Thank you much Investminds :) Appreciate it.

      Delete
  5. Did you get Elec & Eltek recently or did you just not update your portfolio? I saw your last recent transaction for it back in 2013, and your portfolio updated as of 11 apr does not reflect it as well,but your current quarter dividend report shows it giving you $1260

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    Replies
    1. Yes got it recently.

      Will update it next week for month of May.

      Delete
  6. Hello! I have found your blog really enlightening and informational. Really appreciate the effort that you have put in your articles. May I know what're your current thoughts of STI ETF? And what is your view on getting a STI ETF vs a blue chip stock like comfortdelgro as a form of income earning stocks via dividends? Thank you.

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  7. Does it mean you have invested around 120k ?

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  8. I am new to investment but from talking to some friends, seems like I need huge capital for a decent gain in dividend. Are there other investment that can give better yield and at the same time relatively safe?

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    Replies
    1. You don't need a huge capital to invest in anything. Income investing is about starting small as early as possible and roll up to a lump sum as it compounds.

      For yield and risk level, it's up to one's risk of appetite. There is STI ETF which averages around 3% yield for 10 year average, low-mid risk. Else there is the SSB which varies around 2%. CPF provides high yield and capital secured but capital locked.

      So it boils down to individual, risk appetite and finally homework.

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