As mentioned in my earlier post, I’m looking closely at stocks in the energy sector for the month of December. The price of crude oil continues to be volatile and this has provided an excellent opportunity to add to our existing energy stocks.
A few days ago I purchased 60 shares of Suncor to our existing position as a way to average down our purchase cost.
This marks the third Suncor purchase in the last few months. We now have enough shares to DRIP 2 shares of Suncor whenever dividend is distributed. I’m pretty excited that we can now DRIP two shares instead of one.
The price of crude oil can continue to drop, it can also go up. The reality is, we don’t know which way it will go. In fact, we don’t know which way the markets will go in the short term. The overall markets may continue going sideways for the next few months. Does it really matter for a long term investor like me? The answer is NO! A down market is actually a welcomed event during the accumulating phase of a dividend portfolio. Lower priced stocks means we can purchase dividend paying stocks at a discount and wait for the price to recover. I’ve done this with Manualife, Johnson & Johnson, and other stocks in the past. Suncor’s fundamentals remain strong despite the weak crude oil price. I truly believe Suncor price will eventually recover. If you told me half a year ago that I could purchase Suncor at 3.5% dividend yield I’d tell you that you’re nuts. The 3.5% dividend yield for a solid company like Suncor is too good to pass.
Be Fearful When Others Are Greedy and Greedy When Others Are Fearful
Last time I checked this Warren Buffet guy is pretty smart when it comes to stock investing. I think I’ll listen to his advise.
This purchase adds $67.20 in our annual dividend income.