Part 3: Dividends for My Daughter’s New Car

In the last part of this series, we are going to look at Portfolio Management of an Income Stock Portfolio. The difference between a bond portfolio and a stock portfolio is that bonds mature, stock do not. This means that you do not have an almost guaranteed appreciation of your issues in the account. In a bond portfolio, we take the interest and the proceeds after maturity and reinvest this into more bonds. The Investor always has a few dollars left over in the account after every transaction because in most cases only whole bonds can be purchased.

The Williams Plan uses income producing securities such as Utility Stocks. These stocks give high dividends. The idea is to use the dividends to purchase more high income stocks. With the Share Builders Account, the speculator can buy full and fraction of shares. This means that the speculator can use every cent in the account when they execute a transaction.

Here is an example of an account using Share Builders;

Name of Stock ___Symbol Div._ Yield__Price --- Dividend Quarters ---
Nisource Inc. Holdings NI__$0.92 _5.83% _$15.79 __Feb, May, Aug., Nov
Firstenergy Corp ____FE __$2.20 _5.89% _$37.38 __Mar., June, Sept., Dec.
PG&E ____________PCG__$1.82_ 4.26% _$42.74 __Jan., Apr., July, Oct.

These stocks are not recommendations. This example is to show you that your portfolio should be made up of income stocks that give a dividend covering a total of every month in the year. As your stocks grow over time, you as the speculator will be paid every month.

As discussed in Part 2, in every quarter, you will take your dividends plus any additional funds and invest it into one of the stocks in your portfolio, purchasing full and fractions of shares. That means that in March, you invest in Nisource Inc. Holdings, in June, you invest in Firstenergy Corp., and in September, you invest in PG&E.
THE END…….