Portfolio Changes in May
In May, my investment activity continued like clockwork as I managed to put around $1,900 into the market, with a focus on Business Development Companies (BDCs). This has been my strategy for many years now, and I am content with the level of investment I am able to make. This consistent approach has helped me build a portfolio that I am proud of. While opportunities in the BDC sector are becoming scarcer as they rally and the market anticipates no interest rate cuts due to sticky inflation, I remain optimistic about the future.
My main picks in May were Ares Capital (ARCC), Hercules Capital (HTGC), Goldman Sachs BDC (GSBD), and MidCap Financial Investment Corporation (MFIC). I am not expecting any dividend hikes from these stocks, but their current dividends align with my investment strategy. I am hopeful for special dividends once the Fed starts cutting rates, which could make yields more attractive for future purchases. In May, my moves added $149 to my yearly dividend income, setting a positive tone for the year.
The average yield on my new investments in May was around 7.6%, reaffirming my belief in BDCs as a core part of my portfolio. I prioritize steady dividends as a source of income. My goal is to increase my dividend income by about $100 each month, largely achievable due to the high yields from BDCs.
Looking at dividend income for May 2024, there was a slight decrease compared to the previous year, mainly due to timing. However, accounting for various factors, dividend income was up 13% year-over-year and 136% sequentially. The biggest growth in dividend income came from Hercules Capital, a position I have been consistently investing in and am confident about its future prospects.
I have incorporated a BDC/Non-BDC breakdown into my dividend income charts, allowing for more precise monitoring. In May 2024, BDCs accounted for 17% of my total dividends, with expectations of a significant increase in June. Visualizing my dividend income enables me to track trends and patterns over time.
Looking ahead to June, I anticipate strong dividend income, especially from BDCs. Big dividend payers in June include Ares Capital, Hercules Capital, MidCap Financial Investment Corporation, Shell, BP, McDonald’s, Johnson & Johnson, and Southern Company. Overall, I am expecting over $900 in dividend income for June.
As of the end of May, my dividend portfolio is diversified across various companies, with a focus on stable and growing dividend yields. I continue to monitor my portfolio closely and make strategic investment decisions to achieve my financial goals.
Editor’s Note: This article discusses securities that do not trade on a major U.S. exchange. Please consider the associated risks before investing.