In February, my portfolio appreciated by $5 — a modest 1.73% gain.
In March, it appreciated $30 — a 5% improvement.
Still modest, but better, which I appreciate.
March was all about firsts for me.
I’m not talking about every inevitable first that comes with being in the first few months of building a $1,000,000-plus portfolio $10 at a time … the first time buying the dip, the first time investing in Costco on a Tuesday or the first time screwing something up.
I’m talking about the big ones.
Firsts like starting a position in Costco in the first place.
Firsts like receiving my first dividend.
Those were the firsts I’ll remember most about my March as a market participant.
Here’s where things stand 60 days in
My last 30 days in the market saw my portfolio grow from $304.87 to north of $600.
More importantly, it grew by another two positions: Costco and Rivian.
As an established leader in its industry, competing with companies like Walmart, Target and Doller General, I added Costco to the portfolio for a lot of the same reasons I added Microsoft. In addition to a sustainable and growing business model (boosted by membership fees), the wholesale retailer has a sustainable and growing dividend (also, I’m sure, boosted by those fees).
As long as Costco can continue growing its earnings, it should be able to continue growing its dividend. I’ll invest until one of those two things changes, opportunistically adding on the dips.
Here’s a look at the dividend:
Yield: 0.56%
Annual payout: $4.08
Payout ratio: 27.06%
5-year growth rate: 12.34%
Consecutive years of dividend growth: 19
To me, Costco’s stock has some of the same alluring qualities as Microsoft’s. The key difference, though, is the company plays an entirely different game. That’s important as I’m trying to build a portfolio that can perform in any market environment.
I started the position in Costco mostly as a dividend-growth play.
Rivian, as a company that can barely afford to pay its employees let alone a dividend to shareholders, has a different role. While Costco has a clear and defined track record — a history I can lean on as an investor when the market gets a little funky — Rivian has a stock chart that’s gone from $170 a share down to $10.
Needless to say, Rivian is a significantly riskier place to park my $10 investments than Costco.
That said, I’m not investing in Rivian for what it is now; I’m investing for the potential the company has to grow into a major player down the road. When EVs finally get to mass adoption, and they will, Rivian stands to gain immensely, as will all the other EV companies out there. The problem, though, is not all the EV companies out there now are going to be around to see that day.
Rivian, though, with its $9 billion in cash and a brand-new plant poised to pump up production in the coming years, has a chance to stick around. It has a great brand, too. If it can survive today, I think Rivian can thrive tomorrow.
Time will tell.
Speaking of telling, here’s where each of my $10 daily deposits went in March:
I invested in Microsoft six times
I invested in Robinhood three times
I invested in Costco twice
I invested in SCHD twice
I invested in Rivian five times, including three days in a row
11 times, I left the daily deposit in my uninvested cash stash
And here’s an updated look at the portfolio (with total gain/loss on the right):
My money is making money
I think the market is expensive, but you probably figured that out by the last bullet point. As much as I love Costco as a company, the share price is pretty high right now. I’ll bite on a 7% dip, sure, but I’m not planning on pumping a bunch of money into Costco above $700 a share. I’m just not.
Microsoft is probably a little overvalued as well. Robinhood, easily my best performer over the course of the last month, is too. Rivian is undervalued, but is risky. The point? Sometimes it’s best to just let the day’s $10 sit and earn 5.25%.
I did that 11 times, growing my uninvested cash pile from what was typically between $10 and $20 in February to more than $100 by the end of March, benefitting my interest income in a major way.
Interest income for February: $0.02
Interest income for March: $0.28
I also earned my first dividend:
All the interest income and dividend payments automatically flow into my uninvested cash balance, which will then grow (currently at 5.25%) until I put it back to work in either Microsoft, Costco, Robinhood, Rivian or SCHD.
That’s the plan moving forward … just like it was in March.
The purchases change, but the plan remains the same. Stay consistent … and stay invested. I realized 60 days ago my money was going to work a lot harder for me in the stock market than in the bank account and, well, it’s literally paying dividends. It’s not always rip-your-face-off exciting, but this is what investing looks like when you take it one day and $10 at a time.
I hope you’re enjoying the ride.
Are you a market participant?
There are more than a few ways to make money in the stock market, but you can’t take advantage of any of them if you don’t participate. Don’t have much money? Me either. I mean, I’m not investing huge chunks at a time — $10 every day — but it adds up fast. Consistency is key and, if I can build a million-dollar portfolio, anyone else with a phone, internet connection, and a little disposable income can, too.
If you aren’t already, start investing today.
Need a brokerage?
Investing is impossible without a brokerage. If you’re in need, I recommend Robinhood. Sign up with this link and we’ll both get a little something to brighten our financial futures. The best time to start investing was yesterday. Today’s the next best and, well, if you don’t start today I highly encourage you to pencil it in for sometime soon. Your future self will thank you.
Disclaimer: I’m a market participant, not a financial advisor. This is not financial advice … but it could change your life.