It is one of those slow dividend months again….not much action (which is good) but not much money coming in either 😐 So, lets directly jump into the numbers for October 2017. This time, I will post a bit early as I will be heading out for a work related assignment and will not have the time until well into next month.

Main Takeaways this month

• Passive Income Stream
  • My passive Income for October 2017 is approximately 4% lower than October 2016. The only reason for this decrease is that I re-positioned my investments to provide more dividends in the months of Mar, June, Sep and December instead of my older investments that used to have a dividend stream in Jan, April,  July and October.
  • My total dividends at this point in time are actually up compared to last year
    • At this time in 2016, average dividends per month was $603.4.
    • As of now in 2017, average dividends per month is $709.60.
    • So, appx a 17% increase in average dividends per month.
  • I also captured some capital gains from one of my US mutual funds. The stock markets are reaching new levels every day and the only thought that comes to mind is: greater the rise, the greater fall. So, I am staying invested in the US market, but capturing some gains as well.
• Additional Investments
  • Investments in tax-deferred account (IRA)
    • In July, I sold portions of some funds to capture accumulated capital gains and created a cash fund inside my IRA.
    • In August and September, I deployed some of the cash in the cash fund into two international mutual funds to avoid the super expensive valuations of US stocks. In October, I continued more of the same and invested in the same funds again.
      • VTIAX: Vanguard Total International Stock Fund
        • Lower expense ratio
        • Covers the entire international market (large, medium and small caps)
      • VIHAX: Vanguard International High Dividend Fund
        • Higher expense ration
        • Covers a portion of the international market only (mainly large caps)
    • The curious reader may ask: why not just invest everything in the cheaper VTIAX? I am following my old rule of risk diversification….in the same class of mutual funds (international market), I always have two funds compete for your money. So, both VTIAX and VIHAX will now compete with each other to make more money for me 🙂
  • In addition, I noticed now that in my IRA, the percentages of US and International stocks are almost even. I will pile up on US stocks over time in the following ways:
    • Periodic 401K investments are always dollar cost averaging into US stocks (70% of money goes into US funds)
    • In the next recession, I will invest some of the leftover cash fund into mainly US stocks and pick them up at cheaper valuations.