Monthly Update: January 2014

Portfolio Activities
     $1,700 deposits into Investing account
     $325 deposits into Lending Club account
     Sold HAS +43% gain
     Sold OHI +0% break even
     Bought 174 shares of CIG @ $5.78
     Bought 16.63 shares of VTR @ $60.12

Portfolio Income
Dividends
     MDT: $1.49
     SPLS: $2.43
     WMT: $2.10
     ARCP: $2.67
     PSEC: $7.50
     NDRO: $4.16
     JNK: $1.42
     PCY: $1.94
     Interest from cash: $0.46
Rental Income
     Townhouse 1: $855

A big fat $2,025 was made in deposits this month. The extra money came from selling unused vacation time back to my company. Several coworkers have mentioned that I need to go travel some. I do enjoy weekend trips but a week long trip somewhere for 5 days of hotel plus meals, airfare and activities for 2? When I also add in 5 days of extra pay (vacation sellback + working it normally)? I just look at them and say "Do you know what I could do with $1,500?"

I made some portfolio changes. I sold HAS for profit taking and it was looking really toppy. It had broken below its 50 day SMA (simple moving average) and other companies were talking about the struggles they had over the Christmas holiday.  I wanted to be sure I kept that +43% gain and looking at today's price action, it was the right call.

I sold OHI and bought VTR. OHI is a fine REIT and it was a tough decision to sell this one. However when I compared the two fundamental wise VTR seemed like the better deal.

I gave up 1.5% in yield but VTR is more diversified having retirement homes, assisted living homes, and medical office buildings (MOBs). Think of MOBs as the little business parks and buildings that your dentist and chiropractor is in. I have no idea what impact the Affordable Care Act will end up being but seeing as how OHI was only assisted living homes funded by Medicare I think VTR is going to have diversification.
The pullback in its historic price range gives a lot of upside whereas OHI is the most overvalued its ever been. That's not to say its actually overvalued but time and the market will tell.
Additionally, with concerns about rising interest rates, REITs got hammered in 2013 except for OHI. They may or may not have a pullback but VTR already had theirs so I'll play it safe.

I also bought CIG which is a Brazilian hydroelectric power company. That one is odd, interesting, and hard to evaluate. Last year it had a 20% cash dividend plus a 10% stock dividend. The stock dividend needs some explaining. In the U.S. we would call it a stock split and its no net gain as the stock price changes to reflect the new shares. CIG created more shares and gave them out. However in talking with CIG investors that qualified for the split, they received 30% more shares. I bought on the day of the split to take advantage of the drop in share price but the price only dropped by 20%, a 10% net gain for existing shareholders. As I mentioned in my review of CIG, U.S. financial services and websites have a very tough time tracking CIG. So for a 30% net yield between cash and stock, I'm willing to put in the extra time.
As with most foreign companies, they pay a semi-annual dividend. April and December, so you have plenty of time to research this one and I will definitely be reporting their activity on my blog.

January was a real busy month as I also returned to Lending Club. I originally tested them in 2009 and 2010 but I didn't like the search and sorting software on the trading platform so I left with the intent of returning when they improved. They have and I did. I haven't discussed it yet because of Q4 earning season taking my blogging time. IBM, CIG, MCD down and AAPL, STX, RKT, POT, SPLS already reported and I have yet to review them. I have lots of thoughts and ideas about Lending Club that I will share with in February.


Disclaimer: The investments and trades discussed are not recommendations for others. I am not a financial planner, financial adviser, accountant, or tax adviser. The financial actions I talk about are for my own portfolio and money and only suited for my own risk tolerance, strategy, and ideas. Copying another person's financial moves can lead to large losses. Each person needs to do their due diligence in researching and planning their own actions in the financial markets.