In this episode, we will review our portfolios for the last quarter, discuss recent market news, and answer questions from our listeners.
Weekly Updates
Personal Experiences
The hosts share their personal experiences from the past week. Based in the Republic of Ireland, Derek mentions a productive week at work and on the stock exchange, having purchased additional shares in AT&T and Danone. Edgi reflects on a camping trip that limited their access to technology but provided quality family time, which reignited their desire for financial independence.
Market News
A significant topic of discussion is the rising gold prices, which are nearing their all-time high. The co-hosts express concern about the current market dynamics, noting that while stock markets are high, gold prices are also climbing, indicating potential instability. They discuss the implications of the Federal Reserve’s monetary policies and the potential for a market correction.
Q2 Portfolio Review
Performance Overview
The hosts transition into reviewing their Q2 portfolios, highlighting the unique challenges posed by the pandemic. One co-host notes that they spent more than usual, utilizing a war chest saved for such times, and doubled their investments during this period. They list several companies from which they purchased shares, including Munich Re, Danone, Unilever, PepsiCo, and AT&T, among others.
Dividend Income Growth
Despite the challenges, the co-host reports a 29% year-over-year growth in dividend income for Q2, even after accounting for a dividend cut from Shell. They emphasize the importance of diversification and the benefits of being in the accumulation phase of investing, which allows for continued growth despite setbacks.
Capital Gains and Future Outlook
The discussion also touches on unrealized gains, with one co-host reporting a 12% gain on their investments. They express optimism about reaching their financial goals, noting that their projected annual dividend income now covers about 25% of their expenses. The co-hosts reflect on the compounding effect of dividend reinvestment and how it accelerates growth over time.
Listener Questions
Growth vs. Dividend Investing
One listener asks whether early dividend investing limits portfolio growth compared to focusing on growth stocks. The hosts acknowledge the appeal of growth stocks, especially for younger investors, but emphasize their preference for dividend income as a more stable and predictable strategy. They discuss the psychological aspects of investing in growth stocks and the challenges of timing the market.
Company Performance and Market Trends
Another listener inquires about which company might reach a $2 trillion market cap first. The hosts speculate that Saudi Aramco is a strong contender, given its current valuation. They also discuss the potential for Amazon to achieve this milestone due to its expansive growth and market dominance.
Technology Stock Bubble
The final question addresses whether the tech sector is in a bubble and if tech stocks could become the new defensive investments. The hosts express skepticism about current tech valuations and the sustainability of growth in this sector. They highlight the ease of market entry for new tech companies and the challenges of maintaining a competitive edge.
Stock Picks of the Week
As the episode wraps up, the hosts share their stock picks for the week. One co-host recommends Danone, citing its strong market position and growth potential in health-conscious consumer products. The other co-host suggests Cisco Systems, noting its solid dividend history and dominance in networking technology.
Conclusion
The hosts conclude the episode by thanking their listeners for their support and encouraging them to submit more questions for future discussions. They emphasize the importance of learning from both successes and mistakes in investing and express their commitment to sharing insights and experiences in the world of dividend investing.
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Disclaimer
Dividend Talk is not a licensed or registered investment adviser or broker/dealer. We are not providing you with individual investment advice on this site. Please consult with a licensed investment professional before you invest your money. This site is for entertainment, informational, and educational use only.
Any opinion expressed on the site here and elsewhere on the internet is not a form of investment advice provided to you. We use information, data, and sources in the articles we believe to be correct at the time of writing them, but there is no guarantee of their accuracy, completeness, timeliness, or correctness. We are not liable for any losses suffered by any party because of information published on this site. Past performance is not a guarantee of future performance. By reading this site or subscribing to it, you agree that you are solely responsible for making investment decisions with your funds.
