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Can you be profitable with Dividend Reinvestment - my example

By steverobert | wealth concepts | 23 Jan 2024


Dividend Reinvesting Example:

So today according to my broker’s summary screen I lost money on an investment.

Prospect Capital Corp

PSEC     464.932 shares at a cost of $6.45

Today’s price $6.18 it shows a loss of $123.44 or 4.12%

The company pays   $0.72/11.69% dividend monthly.

 

So, am I a bad investor?

Lets look at the investment over time.

In June of 2018 I purchased 280 shares of PSEC at $6.55 commission $6.95 total invested $1840.95

Today value 464.932 x $6.45 = 2998.81

2998.81- 1840.95 = 1157.86 profit or 62% gain in 5 years.

 

So why does my broker think I’m losing money?

It takes in the cost of the dividends that were reinvested each month. As I was paid a dividend it was reinvested in the stock by buying more shares and that was calculated into the profit or loss for all the shares not just the 1st ones I bought.

When you see what I paid initially and what was reinvested I have made a good investment.

At over 11% dividends paid out each month they compound very nicely into profits for me.

Many people may have sold the stock when the price goes down taking a loss and feeling sad.

When the price went down over the last 5 years I celebrated because the dividend I was being paid bought me more stocks when reinvested paying me more dividends the following month. As the price went up, I was happy but bought less stock when my dividends were reinvested.

Buying low selling high takes a lot of time, monitoring, research, and luck to time the market.

I have found over many years of losses and gains with that method that buying for long term dividend reinvestment is much easier and takes less time and effort. You can make a purchase and just wait for the stock to do what it does and reinvest your dividends for growth.

Don’t get me wrong, this is not fool proof, companies can still do poorly. If they cut their dividend and the price falls you could still lose money. Investing is risky but with dividend reinvestment in companies that have time proven dividends is a safer method of investing.

 

PROOF in Transactions:

DATE DESCRIPTION Quant PRICE AMOUNT

6/19/2019 Bought 280 PSEC @ 6.55 280 6.55 -1840.95

7/18/2019 ORDINARY DIVIDEND (PSEC) 16.8

8/23/2019 ORDINARY DIVIDEND (PSEC) 16.8

8/23/2019 Bought 2.515 PSEC @ 6.6791 2.515 6.6791 -16.8

9/20/2019 ORDINARY DIVIDEND (PSEC) 16.95

9/20/2019 Bought 2.548 PSEC @ 6.6528 2.548 6.6528 -16.95

10/25/2019 ORDINARY DIVIDEND (PSEC) 17.1

10/25/2019 Bought 2.61 PSEC @ 6.5521 2.61 6.5521 -17.1

11/21/2019 ORDINARY DIVIDEND (PSEC) 17.26

11/21/2019 Bought 2.667 PSEC @ 6.4715 2.667 6.4715 -17.26

12/20/2019 ORDINARY DIVIDEND (PSEC) 17.42

12/20/2019 Bought 2.605 PSEC @ 6.6862 2.605 6.6862 -17.42

1/24/2020 ORDINARY DIVIDEND (PSEC) 17.58

1/24/2020 Bought 2.654 PSEC @ 6.6232 2.654 6.6232 -17.58

2/21/2020 ORDINARY DIVIDEND (PSEC) 17.74

2/21/2020 Bought 2.715 PSEC @ 6.5351 2.715 6.5351 -17.74

3/20/2020 ORDINARY DIVIDEND (PSEC) 17.9

3/20/2020 Bought 3.561 PSEC @ 5.0266 3.561 5.0266 -17.9

4/24/2020 ORDINARY DIVIDEND (PSEC) 18.11

4/24/2020 Bought 4.431 PSEC @ 4.0867 4.431 4.0867 -18.11

5/22/2020 ORDINARY DIVIDEND (PSEC) 18.38

5/22/2020 Bought 3.638 PSEC @ 5.0526 3.638 5.0526 -18.38

6/24/2020 ORDINARY DIVIDEND (PSEC) 18.6

6/24/2020 Bought 3.639 PSEC @ 5.111 3.639 5.111 -18.6

7/29/2020 ORDINARY DIVIDEND (PSEC) 18.81

7/29/2020 Bought 3.921 PSEC @ 4.7975 3.921 4.7975 -18.81

8/25/2020 ORDINARY DIVIDEND (PSEC) 19.05

8/25/2020 Bought 3.917 PSEC @ 4.864 3.917 4.864 -19.05

9/21/2020 ORDINARY DIVIDEND (PSEC) 19.29

9/21/2020 Bought 4.005 PSEC @ 4.8165 4.005 4.8165 -19.29

10/23/2020 ORDINARY DIVIDEND (PSEC) 19.53

10/23/2020 Bought 4.031 PSEC @ 4.845 4.031 4.845 -19.53

11/24/2020 ORDINARY DIVIDEND (PSEC) 19.77

11/24/2020 Bought 3.956 PSEC @ 4.997 3.956 4.997 -19.77

12/29/2020 ORDINARY DIVIDEND (PSEC) 20

12/29/2020 Bought 3.856 PSEC @ 5.187 3.856 5.187 -20

1/25/2021 ORDINARY DIVIDEND (PSEC) 20.24

1/25/2021 Bought 3.476 PSEC @ 5.8235 3.476 5.8235 -20.24

2/24/2021 ORDINARY DIVIDEND (PSEC) 20.44

2/24/2021 Bought 2.9 PSEC @ 7.049 2.9 7.049 -20.44

2/26/2021 Bought 2.943 PSEC @ 6.9445 2.943 6.9445 -20.44

2/26/2021 Bought 2.9 PSEC @ 7.049 2.9 7.049 20.44

3/24/2021 ORDINARY DIVIDEND (PSEC) 20.62

3/24/2021 Bought 2.786 PSEC @ 7.4005 2.786 7.4005 -20.62

4/27/2021 ORDINARY DIVIDEND (PSEC) 20.79

4/27/2021 Bought 2.712 PSEC @ 7.6665 2.712 7.6665 -20.79

5/25/2021 ORDINARY DIVIDEND (PSEC) 20.95

5/25/2021 Bought 2.667 PSEC @ 7.8565 2.667 7.8565 -20.95

6/21/2021 ORDINARY DIVIDEND (PSEC) 21.11

6/21/2021 Bought 2.5 PSEC @ 8.445 2.5 8.445 -21.11

7/28/2021 ORDINARY DIVIDEND (PSEC) 21.26

7/28/2021 Bought 2.7 PSEC @ 7.8755 2.7 7.8755 -21.26

8/20/2021 ORDINARY DIVIDEND (PSEC) 21.26

8/20/2021 Bought 2.766 PSEC @ 7.6855 2.766 7.6855 -21.26

8/24/2021 ORDINARY DIVIDEND (PSEC) 0.16

8/24/2021 Bought 0.021 PSEC @ 7.6855 0.021 7.6855 -0.16

9/28/2021 ORDINARY DIVIDEND (PSEC) 21.59

9/28/2021 Bought 2.877 PSEC @ 7.505 2.877 7.505 -21.59

10/26/2021 ORDINARY DIVIDEND (PSEC) 21.76

10/26/2021 Bought 2.75 PSEC @ 7.9135 2.75 7.9135 -21.76

11/23/2021 ORDINARY DIVIDEND (PSEC) 21.76

11/23/2021 Bought 2.588 PSEC @ 8.4075 2.588 8.4075 -21.76

11/24/2021 ORDINARY DIVIDEND (PSEC) 0.17

11/24/2021 Bought 0.02 PSEC @ 8.4075 0.02 8.4075 -0.17

12/30/2021 ORDINARY DIVIDEND (PSEC) 22.08

12/30/2021 Bought 2.79 PSEC @ 7.9135 2.79 7.9135 -22.08

1/26/2022 ORDINARY DIVIDEND (PSEC) 22.25

1/26/2022 Bought 2.635 PSEC @ 8.4455 2.635 8.4455 -22.25

2/23/2022 ORDINARY DIVIDEND (PSEC) 22.41

2/23/2022 Bought 2.805 PSEC @ 7.99 2.805 7.99 -22.41

3/23/2022 ORDINARY DIVIDEND (PSEC) 22.58

3/23/2022 Bought 2.888 PSEC @ 7.8185 2.888 7.8185 -22.58

4/26/2022 ORDINARY DIVIDEND (PSEC) 22.75

4/26/2022 Bought 2.844 PSEC @ 7.999 2.844 7.999 -22.75

5/24/2022 ORDINARY DIVIDEND (PSEC) 22.92

5/24/2022 Bought 3.158 PSEC @ 7.258 3.158 7.258 -22.92

6/23/2022 ORDINARY DIVIDEND (PSEC) 23.11

6/23/2022 Bought 3.588 PSEC @ 6.441 3.588 6.441 -23.11

7/27/2022 ORDINARY DIVIDEND (PSEC) 23.33

7/27/2022 Bought 3.332 PSEC @ 7.0015 3.332 7.0015 -23.33

8/22/2022 ORDINARY DIVIDEND (PSEC) 23.53

8/22/2022 Bought 3.077 PSEC @ 7.6475 3.077 7.6475 -23.53

9/26/2022 ORDINARY DIVIDEND (PSEC) 23.71

9/26/2022 Bought 3.428 PSEC @ 6.916 3.428 6.916 -23.71

10/25/2022 ORDINARY DIVIDEND (PSEC) 23.92

10/25/2022 Bought 3.676 PSEC @ 6.5075 3.676 6.5075 -23.92

11/23/2022 Bought 3.361 PSEC @ 7.182 3.361 7.182 -24.14

11/23/2022 ORDINARY DIVIDEND (PSEC) 24.14

12/28/2022 ORDINARY DIVIDEND (PSEC) 24.34

12/28/2022 Bought 3.563 PSEC @ 6.8305 3.563 6.8305 -24.34

1/24/2023 ORDINARY DIVIDEND (PSEC) 24.34

1/24/2023 Bought 3.467 PSEC @ 7.0205 3.467 7.0205 -24.34

1/27/2023 Bought 0.03 PSEC @ 7.0205 0.03 7.0205 -0.21

1/27/2023 ORDINARY DIVIDEND (PSEC) 0.21

2/22/2023 ORDINARY DIVIDEND (PSEC) 24.76

2/22/2023 Bought 3.407 PSEC @ 7.2675 3.407 7.2675 -24.76

3/28/2023 ORDINARY DIVIDEND (PSEC) 24.97

3/28/2023 Bought 3.75 PSEC @ 6.6595 3.75 6.6595 -24.97

4/24/2023 ORDINARY DIVIDEND (PSEC) 24.97

4/24/2023 Bought 3.848 PSEC @ 6.4885 3.848 6.4885 -24.97

5/1/2023 ORDINARY DIVIDEND (PSEC) 0.23

5/1/2023 Bought 0.035 PSEC @ 6.4885 0.035 6.4885 -0.23

5/24/2023 ORDINARY DIVIDEND (PSEC) 25.43

5/24/2023 Bought 4.209 PSEC @ 6.042 4.209 6.042 -25.43

6/26/2023 ORDINARY DIVIDEND (PSEC) 25.68

6/26/2023 Bought 4.36 PSEC @ 5.89 4.36 5.89 -25.68

7/25/2023 ORDINARY DIVIDEND (PSEC) 25.94

7/25/2023 Bought 4.169 PSEC @ 6.2225 4.169 6.2225 -25.94

8/28/2023 ORDINARY DIVIDEND (PSEC) 26.19

8/28/2023 Bought 4.505 PSEC @ 5.814 4.505 5.814 -26.19

9/25/2023 ORDINARY DIVIDEND (PSEC) 26.19

9/25/2023 Bought 4.483 PSEC @ 5.8425 4.483 5.8425 -26.19

9/27/2023 ORDINARY DIVIDEND (PSEC) 0.27

9/27/2023 Bought 0.046 PSEC @ 5.8425 0.046 5.8425 -0.27

10/23/2023 ORDINARY DIVIDEND (PSEC) 26.73

10/23/2023 Bought 4.785 PSEC @ 5.586 4.785 5.586 -26.73

11/22/2023 ORDINARY DIVIDEND (PSEC) 27.02

11/22/2023 Bought 4.964 PSEC @ 5.4435 4.964 5.4435 -27.02

12/22/2023 ORDINARY DIVIDEND (PSEC) 27.32

12/22/2023 Bought 4.738 PSEC @ 5.7665 4.738 5.7665 -27.32

 

http://cointiply.com/r/2LG6E

has been a consistent earner and may be the best without having to do stupid surveys,

 

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steverobert
steverobert

network professional and real estate investor


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