Article of Interest – July 2021

Time for another addition to the “Articles of interest” category. For those of you that are new to this blog, every month I highlight articles from around the world wide web that I found valuable and learned something interesting from.

So let’s get started!

  1. Introducing Behavioral Finance Theory For Individual Investors from Sure Dividend: Sure Dividend is a wonderful site for dividend growth investors with tons of useful information. I have particularly found their “monthly dividend stock in focus” particularly interesting, since they sometimes cover stocks that I had never heard about before. This specific article that I have shared here is a guest post by Artesys online on the site. I have always been intrigued by cognitive biases in individual investors and its impact on their investing- related decisions. I have written about this subject previously on my blog. This article touches on similar topics. I think this is an important subject that does not receive a lot of attention in personal finance discussions. Why so? Because at the end of the day, you are your worst enemy in terms of making objective decisions on investment. When these biases creep in, they cloud your judgement and steer you towards bad investment choices.
  2. PPCIan and his video on Merck (ticker: MRK) and its spin-off Organon (ticker: OGN): While this is not an “article” in a strict sense, this still qualifies as great content. Ian Lopuch is one of the OG Dividend growth investors on the Youtube space. His videos go into all kinds of details, giving useful and interesting ways of analyzing businesses. In this specific video, Ian compares MRK and its spin-off OGN with Pfizer (ticker: PFE) and its own spin-off Viatris (ticker: VTRS). This aspect of relative valuation is very helpful in analyzing businesses, especially when they happen to be in domains which are outside the individual investor’s circle of competence. I especially loved the deep-dive into OGN’s balance sheet and the fine print disclaimer about the debt owed to the parent company MRK. This highlights the importance of looking into the company’s SEC filings and perusing the financial statements very closely. While I am not directly interested in MRK, OGN or VTRS at this time, I have PFE on my watchlist and will be analyzing this business before initiating a starting position.

Disclosure: No positions in PFE, MRK, OGN, VTRS

Articles of Interest – June 2021

Call me old-school, but I enjoy reading blog subscriptions on my old RSS feed reader. There is a wealth of information out there in the blogging community regarding investing in general, and specifically dividend stock investing.

A fellow dividend investor + blogger, Engineering Dividends, has a practice of sharing an article of interest and he/she has this setup as a post-series. I drew inspiration from this and decided to do the same on my own blog.

So here are some articles that I particularly enjoyed reading from the last few days:

DGI is one of the first bloggers that I started reading when learning about dividend growth investing. I have learned a lot from his articles and continue to do so. This post talks about Ronald Read, an average citizen who worked as a janitor and/or at the gas station, invested in high-quality dividend paying stocks throughout his life. By the time of his death, he had amassed a portfolio worth $8 million. I find this story inspiring and it re-affirms my belief in this strategy. My biggest takeaway from this is that you do not need to be a wall-street big-shot to be a successful investor. Even average retail investors such as you or me can be successful using such a simple investing strategy.

I started following this blog fairly recently and the above post happened to be one of the first ones that I read. I find the post to be a good starting point for anyone thinking about getting started with dividend growth investing. Mark has done a pretty good job of covering a lot of breadth without overwhelming the first time reader. I also find a lot of synergies between my approach to investing and the approach that Mark has described in this post.

The last article of interest is a rather somber one, but an important one nonetheless. Tawcan, one of my favorite bloggers in the dividend investing community, writes about how the news of a death a coworker helped put things in perspective with regards to his overall pursuit of financial independence.

In my previous post, I talked about the importance of making sound financial decisions and hinted at cutting down unnecessary expenses whenever possible. While this is a reasonable suggestion, there is a fine line here. And I realize that this pursuit can be taken to an extreme. At the end of the day, we all live once and life is short. And there are times when living the moment with your family and/or loved ones is more important than anything else, even if this means spending some money in that process. Money spent on a vacation with your family or on a wedding, might seem extravagant and unnecessary momentarily. But in the grand scheme of things, those memories that are priceless, which no amount of money can buy back.

So, it is important to strike a balance. Weigh the pros and cons of each major financial decision you make. Ensure that you are living the moment and spending a happy life one or the other. But don’t lose sight of securing your future as well. It is your hard-earned money, spend it wisely. 🙂