March 29, 2019: AGNC

Dividend Portfolio

It was payday, so I bought 56 shares of AGNC at $18.02 for $1,009.02.

Historically, I invest $1000 in one equity per paycheck. In the name of diversification, I switch back and forth between two to three stocks until I reach a goal. Currently, these are LTC and AGNC and my goal is to buy $25,000 of each. However, I recently decided to try to time my purchases based on ex-dividend date instead of blindly going back-and-forth. This is because the ex-dividend date for AGNC was March 28th and so was my payday. I decided to buy AGNC instead of LTC like my schedule mandated.

$1000 of AGNC basically buys me $10 of dividends per month. On average, a few dollars from a dividend payment isn’t going to make or break you, but $10 seems like a lot of money to miss out on when only investing $1000. This may be a step away from my first love, DCA or Dollar Cost Averaging, where you purchase something at a consistent rate and dollar amount over a long period of time (which is exactly what I’m doing, $1000 per month for 25 months). However, I’m not convinced DCA has factored in monthly paying stocks with a 1% monthly return compounded by engaging the DRIP. AGNC is trading around $18, so every $1000 basically means half a share of additional ownership per dividend payment and that is going to add up over 25 months.

I will have to follow up and see if I timed it right. They said the ex-dividend date was the 28th, but I feel like this stuff doesn’t settle for a few days. I wonder if I will be on the books? Any thought on timing purchases based on ex-dividend date rather than DCA date?