Dividend Growth Investor - Investments for June 1, 2026
Good Morning,
I wanted to let you know that I added to two existing positions. One was initiated last month, and the second is one where I have added to for the third month in a row.
I build positions slowly and over time, by focusing on the best values I could find at the moment. Different companies are available on sale at different times. I also test my thesis on fundamentals and valuation as I build out positions slowly. When I initiate a position, I look for companies where I can allocate at least $500 - $1,000 (which works for the parameters of this project). Then I regroup, and see how things go, before investing again.
I have a hard limit of allocating $2,000 on cost per company, in order to manage risk. I expect to be wrong on 40% - 60% of companies. When I am wrong, I want to limit loss to amount I invested, minus any dividends received. When I am right however, a winner will pay for many losers, and then some. In the terms of dividend growth investing, the portfolio effect is such that the dividend should come from a variety of company types:
1. Low yield/high growth
2. Medium yield/medium growth
3. High yield/low growth
All of those work together to generate an organic stream of income that grows above rate of inflation. Under the surface however, you have a lot of companies that may not pull their weight and may fall on hard times eventually. Some may just plod along. A few select ones (or perhaps more than a few) may pull through well, and even surprise you well beyond what you thought was possible in the first place. But overall, the portfolio is like a symphony, with each company doing its part and playing an instrument or some other activity to get to the desired effect of some good music.
I am in effect planting seeds. I have no idea which of the seeds will grow into mighty oaks, and which may end up getting eaten by the squirrels. But I do know that if I keep planting those trees, the overall effect would be a nice forest that could develop over a period of a few short decades. I just need to be patient, and not dig out the seeds every hour, in order to see if they are growing. I just need to let nature do its thing.