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A couple months ago I attended the Investor’s Business Daily investors meeting at one of the public library branches in Vancouver Washington. I was late and only caught the last half of the meeting, but after the meeting I talked with the meeting’s organizer, and emailed him a brief summary of my dividend investing work and a link to this site. Impressed, he invited me to speak at the next meeting in June.

During the time between meetings, I developed a presentation slideshow in PowerPoint that covered the essentials of why I got into dividend investing, my unorthodox strategy of investing in ETF/CEF stocks, my notable successes and failures, and some advice about investing for passive income. On June 4th, I arrived at the library and gave my 30 minute presentation in the middle of the meeting’s allotted 90 minutes. The meeting had only five attendees, including myself, so it was a small audience. I have taken speech class in college and participated in Toastmasters nearly a decade ago, so stage fright or public speaking anxiety wasn’t a problem, fortunately.

However, the presentation wasn’t entirely smooth sailing. I was asked some good questions about my investment choices, and some of those choices weren’t easy to defend. Maybe it’s time to reevaluate some of my dividend stock investments and find areas that need improving. When operating as a solo investor, some constructive criticisms and sharp questions are a beneficial thing, as one can develop a narrow vision when it comes to investing (dividend investing is fun, but it’s not the only investing method).

If you’re curious, my presentation’s slideshow is available for download in either PowerPoint 2019 or PDF format, so check it out and let me know what you think.

Image Credit: mohamed_hassan (


This Post Has 6 Comments

  1. Dividend Driven

    Thanks John for including me as a part your links of interest. What a journey you have had – I agree completely with your final comments too!

    1. Dividend Quest

      Thanks for visiting DD! It has been quite a journey since I first began dividend investing 11 years ago. When I started, a monthly average of $800+ in dividend income seemed to be a fantasy. But month after month and year after year, it has become reality. Thanks for liking my final comments. For many people, the concept of having multiple sources of income (let alone passive income) is foreign to them. When I’ve mentioned the idea to co-workers, they often give me that “Are you out of your mind?” look. 🙂

  2. Jake

    Thank you for sharing! I find myself in a similar position to you – 40+, and have a somewhat similar portfolio strategy (You and I share a few holdings in the CEF / REIT space).

    It would be interesting to know what the audience found good and bad about your portfolio.

    1. Dividend Quest

      Thanks for the visit Jake! Sorry for the slow reply, but I was out of town on vacation. The wisdom of my continued holding of EXG drew the most pointed questions. EXG’s monthly dividend of 6.16 cents per share is comprised of income (0.91 cents) and ROC (5.25 cents). Excluding ROC, the true dividend yield for my initial cost basis is 0.925% (including ROC, the total yield is 6.27%). Why hold onto EXG with such a low real dividend yield and is sloooowly returning capital? Clearly, EXG was a mistake (I bought into EXG in ’09 and ’10 when I didn’t know anything about ROC at the time). I’m reluctant to sell it off, because I believe that calculating total ROC is complicated. Also, if I sold off EXG today, there would be taxable capital gains as the initial cost basis ($17696) has declined due to ROC. As of June 21, 2019 my current adjusted cost basis is $5955.22 and EXG’s current value is $12120. If I continue to hold EXG, then in approximately 6-7 years the adjusted cost basis will fall to $0 and the monthly dividend will be comprised of (from a tax view) income and capital gains. If I sold it all off today, then I’d have a capital gain of approximately $6164, but I’d also have $12120 to invest in better yielding non-ROC stocks (such as USA, HQL, CIK, etc.). I’ve done the math, and if I did that then the impact on my dividend income would be negligible. Hmmmm. Decisions, decisions…

  3. Jake

    Ahh ok! I was worried there was a downside to the overall strategy (Which seems to be working for me so far?)

    I think anyone can nitpick individual holdings / decisions, but that’s why diversification matters!

    I am going through a similar ROC decision with a couple of my holdings (PDT and HTD). In the short term (like within a year), it’s really tough to tell whether or not ROC is good or bad.

    I’ve found I think about CEF’s differently than I do dividend stocks. The math and decision making gets complicated, and I don’t disagree with your decision to continue to hold, especially if you are re-investing.

    1. Dividend Quest

      I agree about nitpicking individual holdings/decisions. Any investment decision can be questioned. Diversification is a good way to mitigate the “stupid factor” of investing. We all do dumb things in our early years of investing, and the best way to minimize that is to diversify and not get too enamored with any one stock.

      As for ROC, like you I find it difficult to determine if ROC is good or bad. Getting your money (capital) back is never a bad thing, as it aligns with Warren Buffet’s saying “Rule #1 of Investing: Never lose money. Rule #2: Never forget Rule #1” It will take a loooong time to get one’s money back via ROC. When one’s adjusted cost basis falls to zero, then any ROC that’s part of the dividend payout will be considered capitals gains (and will be taxed accordingly).

      I also agree that ROC makes things more complicated, so if one desires simplicity (and a true dividend yield), then one should avoid ROC as much as possible.

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