Although the whole point of a dividend portfolio is to invest in dividend paying companies, in the end it’s up to you the investor as to which companies you want to ultimately invest in. Sometimes it’s not even your choice in the example of a spinoff, the new entity might not even pay a dividend and then you must decided on selling or holding the new ticker as was the case with T and WBD.
In early 2022 both AMZN and GOOG announced 20:1 stock splits. Both had share prices north of $2,000 which tends to keep retail investors on the outside looking in, especially if their brokerage doesn’t offer fractional shares. At the time I decided instead of waiting for the split I would buy 1 share of each, which would then turn into 20 shares after the split. For this article I will focus on my GOOG position and weekly purchases.
My initial investment was 1 share at $2,500 on 4/21/22 and after the split turned into 20 and a cost basis of $125. I then proceeded to purchase 1 share a week and as of this week 2/13/23 I now have 50 shares here is a breakdown.
- 7/25 $109.92
- 8/1 $115.80
- 8/8 $120.34
- 8/15 $122.05
- 8/22 $115.92
- 8/29 $111.50
- 9/6 $108.71
- 9/12 $112.91
- 9/19 $102.97
- 9/26 $99.62
- 10/3 $97.38
- 10/10 $99.03
- 10/17 $101.02
- 10/24 $101.53
- 10/31 $95.62
- 11/7 $88.82
- 11/14 $95.59
- 11/21 $98.06
- 11/28 $97.09
- 12/5 $101.40
- 12/12 $93.31
- 12/19 $90.31
- 12/27 $89.26
- 1/3 $90.71
- 1/9 $89.90
- 1/17 $91.78
- 1/23 $99.22
- 1/30 $98.65
- 2/6 $104.14
- 2/13 $94.70
My position is currently 14% in the red but I have lowered my cost basis from the initial $125 to $110.73 with the help of DCA. If I had purchased the 50 shares from the onset it would have required $6250.00 and I would be down 24%. The lowest shares price I purchased was $88.82 back on Nov 17th. If I had purchased my 50 shares on that date I would be up $300 on the position, but I’m not one to time the market.
Dollar Cost Averaging works in both rising and falling stock prices but has an added benefit of lowering your cost basis on positions that are currently in the red. My initial goal was 50 shares and I like GOOG at it’s current price but I will probably pause the weekly purchases and funnel that capital towards dividends. If another dip occurs I will add to the position as it would be nice to reach 100 shares and write covered calls to generate some extra income.