Automatic Investment Plan Transaction for 03/25/2014

Just a quick update on my automatic investment plan transaction:

Ticker Symbol	Date	Purchase Amount	Shares bought	Price per share
LULU	03/25/2014	$300	6.1450	$48.82
WM	03/25/2014	$304 ($4 fee)	7.3750	$40.69

Buying Altria (MO) For Dividends and Growth

I just executed a limit order for 8 shares of Altria (MO) at $34.15.

 

MO closed up at $34.24 yesterday.  The same day the DOW Jones closed at 14,253.77. This is the DOW Jones' new all-time high.

 

Therefore, I anticipated some profit taking so I predicted that MO would at least go down to $34.15 maybe even lower.  My gambit paid off and my limit order was completed earlier today.  I could have gone lower since MO went as low as $34.01 but I think my conservative bet was good enough.  I just want to almost guarantee that I would get those 8 shares of MO.  The main reason why is because we're approaching MO's Ex-Dividend date of March 13, 2013.  The next valid Automatic Investment Plan date is on Tuesday, March 12, 2013.  That is cutting it close since I have to buy the shares a day before the Ex-Dividend date in order to qualify for the dividend pay out.  I decided to execute it early just to make sure plus the trading fees are now $6.95 (down from $9.95) so the $3 difference would be paid for by the dividends.

 

So why Altria (MO)?  First, the dividend pay day is coming.  Second, MO's dividend pay outs increased from $0.41/share in July 2012 to $0.44/share from October 2012.  I love stocks of companies who increase their dividend payments because it tells me their earnings are doing well (after reviewing their financials of course) and they want to reward their investors with more cash. Finally, I am counting on Altria's growth prospects as the global economy improves.  As the global economy improves, MO's customers would be more willing to spend money to buy MO's E-Cigarettes, high-end cigars and wine products.  Even if MO's regular customers do not feel the improvement, they'll still continue buying Marlboro cigarettes (and other MO brands).  If there's one thing I've learned from my siblings (and Mad Men), cigarette smokers have brand loyalty. 

 

So that's pretty much my Altria thesis.  I'll buy more shares in the future and as long as smokers smoke, I'm bullish on Altria's growth prospects.

New Rules

My Automatic Investment Plan just Posted.

Here's a summary of the transaction:
04/12/2011 - Transaction History - Buy
Ticker             Price/ Principal Amount               Fee                     Total
GLD              $141.08/ $146.00                    $4.00                     $150.00  (GLD Closed at $141.61 - Good!)
XLNX           $30.69/ $36.00                        $4.00                     $40.00    (XLNX Closed at $30.64 - Down)
WM              $37.75/ $76.00                        $4.00                     $80.00    (WM Closed at $37.67 - Down)

So I learned that Sharebuilder will collection commissions (fees) within the investment amount I put in for each position.  Basically, I could have invested my $300 and the fees would have been included within the $300 investment rather than getting charged the fee after.  This is good for those who are a bit cash strapped.  However, the $4 per investment could have bought some more "mini" shares of my stock positions.

Anyway, I just have to put in some NEW RULES for our Investment Strategy:

1. I will always keep 10% of my portfolio in CASH.  The reason is to have some cash on hand to catch bargain stocks and have some liquid cash for other purposes.

2. I will have ONLY 10% of my portfolio in Gold (GLD).  Gold is just a hedge for me. I do not plan to get rich off gold.

3. Each position will ONLY cover 20-25% of my portfolio.  This is to keep my diversity and spread out my risk across my portfolio.

First Stocks Purchased

March 29, 2011

Stocks Pruchased:

• Lululemon (LULU) 1 share at Limit Order of $83.00 - I bought LULU for the potential growth of the Lululemon brand in the USA.  LULU is also expanding their brand to Men's and Youth Apparel.  The Fitness and Health trend is growing and the lifestyle and brand marketing LULU is employing have resulted in the growth of sales from the growing fitness-conscious market especially women.  LULU has outperformed the S&P, Nasdaq, Nike and Adidas. (Limit order $83 + $9.95 Base Commission = $92.95)  I plan to have 10 shares of LULU by June 8, 2011.  I will also watch the possible STOCK SPLIT that the shareholders will vote for in June 8, 2011.  My price target to SELL LULU is $100 by 01/30/2012 or gain of 10%.
• Xilinx, Inc (XLNX) 2 shares at Limit Order of $31.00 - I bought 2 shares of XLNX for the 2.00% Dividend yield (XLNX recently boosted it's dividen from 0.16 to 0.19). XLNX is undervalued compared to it's competitor Altera (P/E Ratio of 17.31 vs. XLNX's P/E Ratio of 14.10).  Analyst put a target price of $40 within 12 months.  They are releasing their new programmable chip called "Zynq" that include a CPU core from ARM Holdings.  ARM CPU cores have been used in mobile devices most notably the A5 Chip in the iPad 2.  Will watch for the 04/27/11 earnings report. (Limit Order $31 (x2 = $62) + $9.95 base Commission = $71.95).  I plan to have 10 shares of XLNX by 05/31/2011.  I plan to SELL XLNX at $40 by 01/01/12 or a gain of 10%.

Initial Investment Cash = $200.00

Transactions: 1 share of LULU at $83.00 and 2 shares of XLNX at $31.00 

Fees: $9.95 x 2 transactions = $19.90

Day's Total transactions: $164.90 

Liquid Cash on Hand = $35.10

I left 17.6% of my cash liquid for the possibility of buying more stocks on a pullback.

I like to lock in my profits when my investment gains 10%.. at least decrease my position and hopefully play with the house's money.