How 30 Day Dividends Fits into Your Investment Plan

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Oswald Berry
5 years ago
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1 January 2017 Vol. 3 Issue 8 How 30 Day Dividends Fits into Your Investment Plan W ith this issue of 30 Day Dividends being the first of 2017, I want to start with an explanation of how I see this service fitting in as part of all my dividendfocused newsletter products. My two other services, The Dividend Hunter and Automatic Income Machine, provide stock recommendations to build a long-term dividend focused stock portfolio. Each employs a different strategy and type of income stock focus, but both are about investing in dividend stocks for the long-term. In contrast, 30 Day Dividends, provides recommendations for shorter-term trading opportunities. In This Issue Nordic American Tanker Ltd (NAT)... 3 Portfolio Update... 4 Open Positions... 5 Closed Positions... 6 I keep close watch on hundreds of higher yield dividend paying stocks. There are times when I see that the share price of a particular stock has become significantly undervalued based on history and expected future dividend payments. I also see stocks that have repeatable share price cycles that occur based on the companies' dividend payment schedules. When a stock sets up in price where I see a high probability of making a decent profit in the short to intermediate term, I will send out a trade recommendation. Since launching 30 Day Dividends in June 2014, 60 recommended positions have been closed with 46 closed at a profit. That's a 77% win percentage. The average return has also been very attractive. I will cover those numbers later in this newsletter. When I see an attractive trade opportunity I will send out an on the day that I suggest to purchase the stock. I will also send an on the date when I determine it is time to close the trade. I will occasionally include trade open and close recommendations in the monthly newsletter, so make sure you look through every issue closely. Time frames to hold the stock range from two months out to about nine months. When I initiate a position, I will state a profit target and how long I expect to hold the stock to reach that target. I do not publish new trades on a regular schedule. The recommendations go out when I find the right profit opportunities. On average, I have sent out two new trade recommendations per month. I think of The Dividend Hunter and Automatic Income Machine as services that provide stock recommendations for investors to build long-term stock market portfolios. 30 Day Dividends gives trade ideas to add opportunities for additional profits on top of the results from the longer-term core strategies. To make this clear, 30 Day Dividends is not a core investment strategy, but it can put some 1

2 January 2017 Vol. 3 Issue 8 extra profits in your portfolio if you have a portion of money you would like to be more aggressive with. Finally, I sometimes make 30 Day Dividends trades on some of the same stocks that I have in The Dividend Hunter recommendations list. You should think of the shares purchased from a 30 Day Dividends trade recommendation as separate investments from your longer-term positions in the same stocks. Land, fly or die, Tim Plaehn Editor 30 Day Dividends 2

3 Buy Recommendation: Nordic American Tanker Still Working We have suffered with the two 30 Day Dividends open positions in Nordic American Tanker Ltd (NYSE: NAT). The two trades were initiated at roughly $11 and $10 sequentially, and NAT currently trades for about $8.40 per share. Nordic American Tanker pays a variable dividend which is usually close to 100% of the free cash flow generated during the quarter. For the 2016 second quarter, NAT generated nice cash flow but chose to not follow its usual strategy. It instead made a large cash payment on a new tanker ship. The Q2 dividend was $0.25 per share. In the third quarter, tanker charter rates averaged a low $16,700 per day compared to NAT's cash break even of $11,000 per day. The $5,700 per day gross profit margin resulted in a $0.26 per share dividend declared for Q3. Recently, the Nordic American Tanker CEO, Herbjørn Hansson, sent out a note that in the 2016 fourth quarter the company will report charter revenues of about $20,000 per day. At this charter rate, the gross margin would be $9,000 per day, about 60% higher than in Q3. As a result, I think there is a strong possibility that a dividend of around $0.40 per share will be declared in early February. If that happens, it will provide a strong boost to the share price. If we get lucky, a herd of short selling rats will try to jump ship, and their buy-to-close orders will push the share price even higher. My practice is to have no more than two open 30 Day Dividend positions on a single stock. Since NAT has the two, I will not add a third. However, the prospects are good for a higher share price by mid-february. 3

4 Portfolio Update Since 2016 is finished, I wanted to review the recommended trade results for the last year. To start, here are the closed trade results since the launch of 30 Day Dividends in June Total closed trades: 60 Total closed for a profit: 46, a 77% win percentage Average annualized profit per trade, including losing trades: 63.8% Average holding period: 147 days Median annualized profit per trade, including losers: 37.9% Median holding period: 82 days I think the median numbers give a somewhat clearer picture of the results of my trade recommendations to date. On the profit side, the median weeds out those trades that hit the target price very quickly, resulting in a very high annualized return. On the holding period side, the median calculation minimizes the effects of the handful of busted trades that I kept open for over a year. One trade for Tesoro Logistics LP (NYSE: TLLP) was on the open trades list for almost two years. The TLLP value did recover and the position was closed out for a very small loss. However, there were some big losers among those long-time open trades. Over the course of 2016, I sent s to close out 28 recommended trades. Of those, 21 were profitable for a 75% win percentage. 13 of the closed trades had been opened prior to January 1, Six of the 13 were profitable, leaving seven losing trades that were recommended before the start of the year. During the year, I focused on cleaning up the open positions list by closing out losing recommendations that had been entered during the energy sector crash/bear market. On a more positive front, 15 trades were closed that had been opened at some point during Of the 15, each one was closed at a profit! Annualized returns on those trades ranged from a measly 2.25% to 490%. The big gain was made on Plains GP Holdings LP (NYSE:PAGP) when the stock hit it's 17.5% raw gain target price in just 13 days. I think the higher win percentage in 2016 was due to a combination of a good market to trade price swings and an employment of a less aggressive approach to picking trades. After some of the dogs I recommended in 2015, I worked very hard to find and recommend high probability winners in Since the stock market has been almost all up since the election, there have been few 30 Day Dividends type of trade opportunities over the last couple of months. You can be certain, however, that the market will cycle and I will find more opportunities for shorter-term profits in the future. 4

5 Current Portfolio Ticker Buy Date Buy Recent Target Total Return Notes CSAL 12/05/16 $25.34 $25.41 $ % Long-term position. SRLP 10/04/16 $24.11 $28.10 $ % Long-term position. NAT 09/27/16 $9.98 $8.40 $ % Short-term position. NAT 08/16/16 $11.13 $8.40 $ % Long-term position. TEGP 08/03/15 $29.97 $26.80 $ % Long-term position. Recent price is determined by the last "Ask" price at the closing of the market on the day before publication. Last Updated 12/30/16. 5

6 Recent Closed Positions Ticker Buy Date Buy Close Close Date Annualized Return Total Return TCAP 09/15/16 $19.00 $ /01/ % 0.47% BXMT 10/10/16 $28.37 $ /29/ % 7.61% TEGP 07/01/16 $23.34 $ /15/ % 17.47% TRGP 06/02/15 $92.69 $ /04/ % % AROC 11/30/15 $10.57 $ /28/ % 21.40% PAGP 08/01/16 $10.32 $ /08/ % 17.54% WNR 02/26/16 $26.63 $ /07/ % 2.25% WNR 06/01/16 $22.68 $ /07/ % 18.39% LGCY 07/07/15 $8.75 $ /03/ % % CNNX 03/19/15 $18.35 $ /01/ % -0.05% For the rest of the 30 Day Dividends Closed Positions, please visit the Portfolio section of our website by clicking the link below. Click here to access the online portfolio. Notes: Entry price is determined by the last "Ask" price at the closing of the market on the day before publication. Recent price is determined by the last "Ask" price at the closing of the market on the day before publication. Total Return includes share price appreciation and dividend payments to provide a more accurate assessment of returns in that investment. Annualized Return represents what the stock would have returned at the same rate if held for a year; this is a way to balance returns on stocks held for different periods of time.we make no guarantee that any company in the portfolio will continue dividend payments Investors Alley Corp. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Investors Alley Corp., 41 Madison Avenue, 31 st Floor, New York, NY or For complete terms and conditions governing the use of this publication please visit 6

Making Goals and Sharing Results. In This Issue. October 2016 Vol. 3 Issue 5

Making Goals and Sharing Results We put the 30 Day Dividends service together as a way to share shorter term profit opportunities that I discover during the course of my research into a large number of