In the earlier post I discussed about the goals that I have for my dividend portfolio. In order to achieve that goal, I have co
1. Maintain portfolio asset allocation that is diversified in asset class, industry sectors, style maps, and geographical region.
2. Focus on growth of portfolio’s dividend cash flow – companies that consistently pay and grow dividends.
3. Invest in companies that I understand, has good fundamentals, and industry leading position.
4. Make use of ETFs and/or index funds for asset allocation purpose.
5. Any individual security should not be more than 5% of dividend portfolio.
6. Buy only at discount – do not buy at historically high levels.
7. While buying a security do following:
– Identify the role it plays in the dividend portfolio.
– Monitor its progress with respect to its role.
– Exit the security from dividend portfolio if it does not meet its role.
8. Dividend growth investing is long term process. Do not react on media news and sky-is-falling scenarios. Be patience and remember that “slow and steady wins the race”.
These rules provide