September has been really bad for the stock market so far. A lot of the stocks are tumbling but it was also a good time to load up on stocks that I already own.
It’s been a crazy month so far. The stock market phenomenon called “The September Effect” is in full swing and investors are feeling it.
According to Investopedia, “The September effect refers to historically weak stock market returns for the month of September. […] It is generally believed that investors return from summer vacation in September ready to lock in gains as well as tax losses before the end of the year. There is also a belief that individual investors liquidate stocks going into September to offset schooling costs for children.”
This is almost similar to The October Effect, and the opposite of The January Effect.
From what I learned, although the effect is not an overwhelming indication that the stock market will crash, it still causes further fear from market actions.
When the market goes down, more investors become fearful for their investments, possibly instigating further selloff. That just ripples further and more investor selloff, until it bounces back up because stocks are now at a discount.
And that brings me to share with you what I bought for September because it was a great buying opportunity for me. So let’s look at them right now.
Arbor Realty Trust, Inc. (ABR)
In my recent Monthly Dividend Income Update, I mentioned adding ABR to my watchlist as a replacement to my AGNC and NRZ positions.
I’ve recently closed out both of those positions giving me extra funds of more than $400. And this got me to buy in September, which was apparently the right move. I didn’t know about The September Effect beforehand, so it was pure coincidence that this happened.
I’ll explain more in detail why I closed these two positions in my next Dividend Income Update.
To those who don’t know ABR, they’re a real estate investment trust and direct lender that provides loan origination and servicing for various real estate assets.
This is their Dividend Scorecard:
While ABR is not a monthly dividend stock, I believe it is a better option than the two I previously had — AGNC and NRZ.
There’s only 1 transaction for ABR in September:
This purchase happened on September 10, and bought 10 shares, at a price of $18.15 through a limit order.
Always do a limit order, so you can take advantage of even the smallest movements in price. If don’t hit your target price, that’s okay because you still have tomorrow or the next day.
Anyway, my 10 shares of ABR account to 2.50% of my portfolio. I want to bring this amount to at least 5% to balance my portfolio.
Enterprise Products Partners LP (EPD)
And here I am again with EPD!
I’ve been loading up on this stock for quote some time now because it still hasn’t gone back to the $25 levels. So this was still a great buying opportunity for me. I can Dollar Cost Average this stock and get more dividends every month at a discount.
Here’s a quick detail about EPD. It’s midstream energy company that distributes and stores energy.
I made 2 transaction for EPD in September:
The first purchase was on September 10, along my purchase of ABR. I added 3 shares, at a price of $22.28 each, to my holdings.
The second purchase was on September 20. I bought 6 shares at a price of $21.57. I’ve been really loading on this stock because I wanted to get more shares to my monthly dividend stocks than to my quarterly stocks, which you’ll observe later on.
With these 2 purchases, I now own 20 shares of EPD at an average price of $22.36, at least 50 cents lower compared to my previous “What I Bought” update. EPD now holds a position ratio of 6.01% in my portfolio, close to double than what I had last time.
PIMCO Dynamic Credit and Mortgage Income Fund (PCI)
PCI here is a very old stock that I own, way back in my TDAmeritrade portfolio. I haven’t added much to it, except for buying 1 share back in June.
If you don’t know PCI, it’s a closed end fixed income mutual fund launched and managed by Allianz Global Investors Fund Management LLC, and co-managed by Pacific Investment Management Company LLC. It invests in fixed income markets across the globe, with an emphasis on opportunities in developed and emerging global credit markets.
This is their Dividend Scorecard:
They have been paying me dividends since I can remember, although inconsistent when I looked more into it. I may or may not hold on to this stock for a longer time, but I do like that it’s paying me monthly. But of course, there are better ones out there.
I’m just holding on to it right now because I haven’t found a better alternative yet.
Anyway, there’s only 1 transaction for PCI in September:
This transaction happened on September 20, where I bought 5 shares at a price $20.95. I added more shares to this stock because I wanted more monthly dividend payers, and I was at the last $100 on my balance. So I was like, why not?
With this lone purchase, I now own 20 shares of PCI, with an average price of $21.09. PCI currently holds a position ratio of 5.83% in my portfolio. I won’t be adding more to this stock since I’m still unsure if I should hold it or not.
AbbVie (ABBV)
AbbVie hasn’t performed well in the past month. They hit a high of around $120 at the beginning of the month, but has slid down ever since to level it is in right now. But that’s just a buying opportunity for us dividend investors.
If you don’t know, AbbVie discovers, develops, manufactures, and sells pharmaceuticals around the world. And their most popular product is HUMIRA, a therapy administered as an injection for autoimmune and intestinal diseases.
Only 1 transaction for ABBV happened in September:
That transaction was on September 20, and I bought only 1 share at $106.45. Compared to when I first bought ABBV last month, it was at $114.25. That’s around $8 less now. While I wasn’t able to buy more of ABBV because it is a quarterly stock, and I have been focusing on adding more to my monthly payers, this purchase significantly reduced my average price.
With this transaction, I now own 3 shares of ABBV at an average price of $111.65, which is around $3 less than last month. And ABBV currently holds a position ratio of 4.42% in my portfolio.
Main Street Capital (MAIN)
Next purchase is Main Street Capital (MAIN)!
MAIN hasn’t been performing good, or bad either, for this month. There weren’t any crazy price actions happening, so for me, it was kind of hard to pinpoint at what price I should get into. But, nonetheless, I added more to the stock.
Only 1 transaction for MAIN in September:
This transaction was on September 20, and I only bought 1 share at a price of $40.73. Even though it’s a very small amount, I’m still happy with this move because I’m adding more to monthly payers.
With this purchase, I now own 5 shares of MAIN, with an average price of $41.56, which is 20 cents less than last month. And MAIN now holds a position ratio of 2.85% in my portfolio.
New York Community Bancorp (NYCB)
Finally, the last stock I bought in September is NYCB.
NYCB provides banking products and services in Metro New York, New Jersey, Ohio, Florida, and Arizona areas, and they offer a wide variety of typical banking products.
This position is fairly new in my portfolio, but I’m liking how it is performing so far. Not too bad, but not to good either, despite moving in an upward trend.
I only made 1 transaction for NYCB in September:
This purchase was made on September 21, and I bought 9 shares at a price of $12.46. For this month, I was actually thinking of buying Lument Finance Trust because the dividend check falls in this month.
However, I was already too late because their Ex-Dividend Date was on September 14, and my purchase won’t be counted towards the new paycheck.
With this purchase, I now own 16 shares of NYCB, at an average price of $12.24, which is at least 30 cents higher than last month. And NYCB currently holds a position ratio of 2.76% in my portfolio.
Plans Moving Forward
Moving forward, I’m gonna try my best to add more to the monthly payers, so I can invest the dividends back more frequently. I’m still gonna add to quarterly stocks, but probably less, or when the situation needs it.