My income portfolio

[Dod101]

As I expected, I have today passed last year’s income and with about five weeks to go until the year end, I confidently expect to be up around 10% over the year thus pretty well matching inflation. Where the capital will end up is of course entirely uncertain but so far it looks reasonable. I must say that that is pleasing because I primarily invest for income but aim to at the very least maintain the capital in nominal terms.

Dod

[Itsallaguess]

As I expected, I have today passed last year’s income and with about five weeks to go until the year end, I confidently expect to be up around 10% over the year thus pretty well matching inflation.

Where the capital will end up is of course entirely uncertain but so far it looks reasonable. I must say that that is pleasing because I primarily invest for income but aim to at the very least maintain the capital in nominal terms.

I'm just five days behind you then Dod, as my dividend income will pass last years level on Wednesday of next week. I should add that I'm still working, and don't spend any current income from my investments.

Also similar to you, I've been very pleased with the way my portfolio capital has held up this year, although it's noted of course that there's currency benefits in there that have helped on that front.

Overall, for me, a very steady year for my income-investments, with new ISA funds being invested earlier in the year, and some fairly regular top-ups since, as dividends have accumulated, but that's also been on the back of accruing a relatively chunky holding of cash, as I expect there will continue to be opportunities over the short to medium term, and I always like to have funds available for when those broader issues might cause any opportune market turbulence. I'm happy with my current cash levels though, and will now continue to regularly invest any additional dividends straight back into my portfolio once they've reached a level that keeps trading costs down to an appropriate level.

I've already got some plans in place for the next ISA year, to hopefully position my non-sheltered account so it will comply with the lower dividend-allowance limits, and I consider myself very lucky to have tapered things into my ISA accounts for many years now, with just the tail end to mop up and hopefully stay under what feels like a rapidly lowering non-sheltered allowance bar...

Cheers,

Itsallaguess

[BullDog]

Don't wish to be a miserable so and so unnecessarily. But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019? I don't have a number myself since my first ever portfolio drawdown is planned for Q1 2023 and I have a fairly recent income generating portfolio to draw from. Thanks.

[daveh]

As I expected, I have today passed last year’s income and with about five weeks to go until the year end, I confidently expect to be up around 10% over the year thus pretty well matching inflation. Where the capital will end up is of course entirely uncertain but so far it looks reasonable. I must say that that is pleasing because I primarily invest for income but aim to at the very least maintain the capital in nominal terms.

Dod

My income portfolio (mostly HYP shares with some ETFs and ITs for non UK income) overtook last year around the end of September, but I'm still reinvesting dividends and adding some new money. I'm already 17% up on last year and expect I will be around 19% up by the end of the year, I just have 3 ETFs left to declare a dividend that is paid this calendar year. It's been a pretty good year for dividends for me, capital is down slightly, about 2% down on last year's year end value.

My first job up to April next year is to bed and ISA as much as possible to get my un-sheltered divi income below £1000 without incurring CGT and do the same next tax year to get it down to under £500. One problem is I have a large SMDS holding un-sheltered which has some good capital gains, but it's with the wrong broker. The ISA at the same broker is not getting new money so I can only move it in as divis become available - may have to split it to my other broker, but that makes doing it more complicated. Need to do it reasonably promptly as the CGT allowance is also reducing, which could be a problem in a takeover situation.

[AsleepInYorkshire]

As I expected, I have today passed last year’s income and with about five weeks to go until the year end, I confidently expect to be up around 10% over the year thus pretty well matching inflation. Where the capital will end up is of course entirely uncertain but so far it looks reasonable. I must say that that is pleasing because I primarily invest for income but aim to at the very least maintain the capital in nominal terms.

Dod

This is good news Dod. I'm assuming of course that we are all at Dod's home for Christmas dinner with all the trimmings and plenty of brandy on the pudding .

AiY(D)

[daveh]

Don't wish to be a miserable so and so unnecessarily. But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019? I don't have a number myself since my first ever portfolio drawdown is planned for Q1 2023 and I have a fairly recent income generating portfolio to draw from. Thanks.

Well ahead of 2019 in cash terms. Table shows unitised dividends in pence per unit for accumulation and Income units for the dividends declared for this calendar year. So I'm also well ahead of 2019 for the dividend per Accumulation units, but still not caught up per income unit.

Year  Accum. Units  Income Units
19    18.32p             8.74p
20    12.35p             5.58p
21    17.91p             7.69p
22    20.48p             8.39p

[BullDog]

Don't wish to be a miserable so and so unnecessarily. But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019? I don't have a number myself since my first ever portfolio drawdown is planned for Q1 2023 and I have a fairly recent income generating portfolio to draw from. Thanks.

Well ahead of 2019 in cash terms. Table shows unitised dividends in pence per unit for accumulation and Income units for the dividends declared for this calendar year. So I'm also well ahead of 2019 for the dividend per Accumulation units, but still not caught up per income unit.

Year  Accum. Units  Income Units
19    18.32p             8.74p
20    12.35p             5.58p
21    17.91p             7.69p
22    20.48p             8.39p

Thanks. Much as I suspected.

[ReformedCharacter]

Year  Income Units  %

19     0.241 
20     0.197    -18.26
21     0.255     29.83
22     0.299     17.15

RC

[Bagger46]

Don't wish to be a miserable so and so unnecessarily. But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019? I don't have a number myself since my first ever portfolio drawdown is planned for Q1 2023 and I have a fairly recent income generating portfolio to draw from. Thanks.

Well ahead of 2019 in cash terms. Table shows unitised dividends in pence per unit for accumulation and Income units for the dividends declared for this calendar year. So I'm also well ahead of 2019 for the dividend per Accumulation units, but still not caught up per income unit.

Year  Accum. Units  Income Units
19    18.32p             8.74p
20    12.35p             5.58p
21    17.91p             7.69p
22    20.48p             8.39p

A few technical notes on unitisation( not addressed to the current poster in particular):

You should not be surprised at the fact that divi per acc unit are galloping and leaving divi per acc units standing: there is an element of double counting and they should not really be used, because inherent to the unitisation process, they will progress at the rate of the intrinsic yield of the portfolio ( in practice near the portfolio yield, but a better measure, see below) even if there was NO underlying divi increase at all.

Only divi per inc units ( properly accumulated automatically as divi come in if you want accuracy) reflect the underlying true progress of divis.

The intrinsic yield is defined as the' mathematical ratio' of the compound growths of acc units and inc units ( ie (1+acc units growth%)/(1+inc units growth%)-1) over a given period. It is the finest yield measure one can calculate because it encompasses the 'history' of the unitised portfolio over that period. In practice it will be reasonably near to the historical yield over that period,( if it was very different, then your unitisation would contain errors).

Any unitiser who relies on divi per acc unit progress to model their progress relies on fresh air to assess how underlying divi are doing.

Calculating both inc and acc units is, however very useful for all sorts of other reasons and is easily done automatically anyway, when the portfolio system/spreadsheet is properly setup of course, a job you only need to do properly ONCE, as normal portfolio events are recorded. No extra work at all, I never lift a finger in unitising, it is done on the nail for me, correctly, instantly as I enter portfolio events in the 'ledger' table.


Bagger

PS: I have unitised all our portfolios ( and those of very many friends and relations), for many decades, way before these boards ever mentioned the subject, because a visiting speaker from the City introduced the method to our then investment club. (We needed such a method anyway to account properly fo settling with members leaving and joining, a useful byproduct). I sadly constantly spot errors, some fundamental, with unitisers data on theses boards, but the worse the error, the less receptive the 'offending' poster in my experience, so I rarely bother nowadays. Too long in the tooth anyway.

[Dod101]

Don't wish to be a miserable so and so unnecessarily. But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019? I don't have a number myself since my first ever portfolio drawdown is planned for Q1 2023 and I have a fairly recent income generating portfolio to draw from. Thanks.

Well ahead of 2019 in cash terms. Table shows unitised dividends in pence per unit for accumulation and Income units for the dividends declared for this calendar year. So I'm also well ahead of 2019 for the dividend per Accumulation units, but still not caught up per income unit.

Year  Accum. Units  Income Units
19    18.32p             8.74p
20    12.35p             5.58p
21    17.91p             7.69p22    20.48p             8.39p

Me too. Well ahead of 2019 but I do not unitise. I may say that I hold no miners or house builders, except Gleeson, which has not proved to be in quite the same league as the big ones.

Dod

[Hypster]

Hello Dod, are the constituents of your income portfolio still the same as listed here?
viewtopic.php?f=31&t=16638&start=20#p206239

[monabri]

You should not be surprised at the fact that divi per acc unit are galloping and leaving divi per acc units standing:

Hmmmm..

[Bagger46]

You should not be surprised at the fact that divi per acc unit are galloping and leaving divi per acc units standing:

Hmmmm..

Typo, I saw it way too late to edit. Old age creeping in too. I think the remainder of the post made my meaning clear.

Bagger

[moorfield]

But I would be very interested to hear where portfolio generated income is this year is compared to pre covid, say 2019

Income so far this year has comfortably doubled that of 2020. I have since "upcycled" all low yield (ie. less than CTY) holdings into higher yield unmentionables (*)

(*) Edit: since this isn't HYPP, I guess I don't need to call them unmentionables actually.

[Dod101]

Hello Dod, are the constituents of your income portfolio still the same as listed here?
viewtopic.php?f=31&t=16638&start=20#p206239

I am flattered that you should be able to go back to 2019!

Looking at the previous portfolio, I lost Mucklow to a takeover, and have since added back SSE, added 3i Infrastructure, and a couple of Canadian banks, TD Bank and Bank of Montreal, and both have enhanced their yield by currency movements. But I do not make many changes.

No new money but funded by sales of Edinburgh, Temple Bar, Vodafone and HFEL. In retrospect I could have kept Edinburgh and Temple Bar but never mind. Glad to have lost Vodafone and HFEL.

Dod

[OhNoNotimAgain]

Has anyone looked at the alternatives?

[tjh290633]

I have looked at my income unit results for the calendar years of late:

Year to   Unit Val    Chg     Div/unit 
                              All     Ords
31-Dec-14    5.55    -1.05%   26.91   20.34
31-Dec-15    5.61     1.14%   22.96   21.35
31-Dec-16    6.12     9.01%   24.28   21.68
31-Dec-17    6.37     4.12%   30.75   25.40
31-Dec-18    5.47   -14.16%   28.82   27.02
31-Dec-19    6.20    13.43%   31.63   26.36
31-Dec-20    5.57   -10.20%   20.28   29.71
31-Dec-21    6.40    14.86%   29.90   19.24
31-Dec-22    6.16    -3.71%   37.82   25.81

Under div/unit, the first column is the calendar year while the second is the financial year including 31st December specified. That column excludes special dividends. The last row is dividends announced so far. There are 9 more to be announced for 22-23.

I went back further in time, because it shows some more detail. With Special dividends included, 2014 was a peak at that time.

TJH

[ADrunkenMarcus]

My dividend growth portfolio's dividend per income unit is showing:

3.23p (year to 30 April 2018)
3.41p (year to 30 April 2019)
3.40p (year to 30 April 2020)
2.90p (year to 30 April 2021)
3.06p (year to 30 April 2022)

The figures are distorted somewhat because I have been constantly diluting my dividend growth portfolio by adding capital and purchasing lower (or non-existent) yielding investments with the new capital. While unitisation adjusts for the capital added to the portfolio, the newer units contribute little or nothing in the way of yield and so the dividend per income unit is nonetheless diluted.

Looking at the absolute level of dividend income received, this is roughly at it's pre-pandemic level (ignores specials, which I've had many of!)

Best wishes,


Mark.

[funduffer]

Both my HYP and IT portfolios have delivered record levels of absolute income in 2022, increasing by 20% and 25% respectively over 2021.

Both portfolios were started with lump sums in 2013/14, and have both had a few top-ups and some new capital over the years.

All well and good, but of course we should really look at income/dividend unit as explained so eloquently by Bagger46 earlier in this thread.

For the HYP, income per (div) unit is up 10% this year, but is still well short of the level in 2019 (82% of it in fact).

For the IT's, income per (div) unit is up 20% this year, and now at record levels, and also 20% higher than in 2019.

I know which portfolio has been more successful!

Another thread on all this in the New Year maybe.

FD

[Arborbridge]

Congrats to all fellow income investors who have had quite a good time this year with some welcome normalisation happening.

Total income, year to November, is above last year and 2019 to November, but I won't know how much until I complete November - haven't logged in this week.
For this reason not sure about "bang per buck" (i.e. unitised income) but it's very similar to 2019 which is a bit of a success considering it looked like the end of the world was coming. Perhaps it'll come in 2023 instead

All a bit premature as I do my "big check" at year end.

Arb.