January 2020 – Passive Income Update

January 2020 was a good month for interest and dividend income. Dividend Income keeps rising while interest income is steady.

The most striking aspect of my investment adventure that is in part motivated by several bloggers that this is actually working very well.

All I have to do is be patient invest wisely and everything is going to be just fine. That said, I unexpectedly invested large amounts last month. I did it mostly because I did not realize that I was deploying so much. Maybe subconsciously, I am trying to get to $100,000.00 account value by the end of the year or sooner.

I purchased about 0.87% of account value noncorrelated 3X beta SXPU and SQQQ to cushion when the market will tank. In January we had a few days higher volatility and these ETFs took off like rockets. These positions did their job. So, my decrease in account value was not as much. Conversely, right now even though they are a small position, the account is dragging a little bit in performance.

However, I know myself and I know very well that I would have a very hard time seeing my account value dropping 50%. Therefore, these positions are here to stay as my insurance policy against major market pullbacks.  My goal is to keep those positions at 0.50% portfolio value.

My total return on investment is 21%. The total return combines the increase in account value and the total dividend received. Thus, if the market will drop by a whole lot, I have a 21% margin of safety. That’s said I doubt that my portfolio will drop 21% in value even in a major correction because I have been buying at their lows noncorrelated assets, such as gold, silver, bonds, and the one once previously mentioned.

I will, however, liquidate, the mostly noncorrelated assets if a major market occurs and pile up equities.

My Robinhood account states that I should expect to receive a total of $1,851.59 in dividend income based on my account value, thus my yield based on the cost basis of the account is 3.81%. The cost basis yield percentage should be rising due to dividend increases over time in the market.

Securities Investment:

I deployed $4,300.13, which is a lot more considerating my rolling monthly average is $1,315.01. This is mostly due to paying outstanding short-term credit card debts that I had a zero percent interest.

I purchased the following securities: CXW, DBC, BTI, SLVO, GLD, BND, VPU, DAL, IAU, KO, DFS, GD, SPXU, IDV, EMR, ENB, KMX, PG, SO, WRK, SQQQ, BA, GLDI, CLX.

I actually sold something. I sold LEG because I felt that this stock is volatile. I will recognize a long-term capital gain of $70.00.

Dividend Income:

The dividend income in January 2020 was $107.41. It looks like the $100.00 per month minimum will be the new average.

Contribution Amount/Change in Value, and Dividend Income Summary Table:

I really enjoy this chart. The blue is my investment, the red is the change in value, and the bright green is the dividend income. As you can see everything is working very well.

Overtime Dividend Income Summary Table:

Passive Income Summary:

Everything looks good with the exception of interest income. The interest income seems very low to the investment account. At a bare minimum at 5% at $9,292.57, I should be getting about $40.00. So, I called today the corporate office and spoke with a lady. She said that she will get back to me with an answer.

Lending Club interest income and account value did very well in January. I have a new investment none scientific strategy that I think is working. I won’t reveal it.

Prosper interest income is low because I am closing down the account. I am hoping that I will be able to close it this year.

This is it for now. Thanks for reading.