I have an important decision to make: Do I focus or expand my dividend portfolio. This decision is related to my post on how to invest $20,000. Be sure to check out that post if you haven’t read it. In a nutshell, I will be receiving a $20,000 bonus from work. Thus, I will have about 8-10k to invest in my dividend portfolio.
At issue is my Capital One Investing account. With Capital One Investing, I pay $12 per month for 12 trades in that month. If I had only six stocks in Capital One Investing (formerly Sharebuilder), I could invest twice a month. That would equate to my 12 trades. However, If I had 12 stocks in my portfolio, I could invest once per month, and again, that would equate my 12 trades. If I do more than 12 trades per month, then I would pay $1 per additional stock, and I don’t want to do that.
So, that leaves me with the instant question. With an additional 8-10k to invest in my dividend portfolio, should I use that to boost the current number of stocks I have in Capital One Investing or expand my dividend portfolio to 12 stocks. If I decide to focus on my current portfolio, I would only focus on 6 stocks (probably ignoring MMM for now). On the other hand, if I decide to expand, I will add 5 more stocks to my dividend portfolio. Either way, I achieve the passive and automatic investing that I so desire.
I haven’t really identified the 5 stocks I will invest in, but so far, I’m leaning towards HCP, CSCO, SBUX, VYM (index fund) and VZ. I’m also considering SYY. Decisions, decisions.
If I decide to focus, I would probably not invest in MMM. I realize it’s a decent company, but, because of it’s current price, I won’t own as many shares – at least not immediately. So, I would focus on every other stock in my portfolio.
As a reminder, JNJ, XOM, and ABBV are DRIP stocks with Computershare.
Conclusion
So, what do you think? Given the fact that I only have anywhere from 8-10k to invest in my dividend portfolio, should I focus or expand? Should I focus on 6 stocks, or expand to 12. If I expand to 12, I will likely not add anymore stocks for some time. I look forward to your comments as to whether I should focus or expand.
Sounds like a win either way really. As long as you are putting the money in your investments on quality companies, long term you will get similar results. Either way your passive income will go up a lot with that kind of cash invested. I wish I had the problem of having a large portion of cash haha. Good luck in your decision.
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Thanks Div Daze. I’m really not sure what I want to do. I am leaning towards increasing the portfolio to 12 stocks. But, that would also lock me in (psychologically), so if there’s another stock that comes along that seems like a good stock to invest in, I would probably still avoid that stock until I have a respectable amount in the portfolio. I definitely want to limit trading fees. That being said, even after I increase the number of stocks in my Capital One Investing account to 12, I will still be able to invest in other companies through Computershare. There, I would invest in free-only DRIPs, so there wouldn’t be an additional trading fee to invest. So, I guess I could increase the number of stocks in my portfolio if I wanted to by investing in DRIPs. We’ll see, but that’s the route I’m leaning towards. I will definitely disclose what I do.
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