I think i just broke the cardinal rule of holding stocks for dividends. I sold some.....
Late last year, I read an article by a fellow investor (whose strategy I generally agree with) who talked about trimming some of your winning dividend stocks (ie, those which had seen steep capital appreciation) in order to then reinvest those profits into other dividend payers which are a better value. He went on and on about how this can help bolster your dividend income in the long run, and it made sense... even though this was a concept which I had never intended to employ. "What the hell," I told myself. "Maybe I'll try it just once." I sold three of my shares of CINF, and spent that money buying two more shares of IBM. (At that time, the 3 CINF sold for the same total price as the 2 IBM shares cost--it was a lateral move financially.) This swap gained me an additional ~$1.50 in dividends each quarter--not earth shaking, but I just wanted to try this new philosophy and see how things went.
I am kicking myself for this move.
From a dividend standpoint, my emotions are mixed. Since the swap, CINF has raised their dividend by 5%. So far, IBM hasn't raised theirs at all. While I'm still coming out ahead, I wonder if eventually that won't be true any more.
While it isn't the primary focus of my account, even worse is the capital appreciation. CINF share price has continued to climb; I initially bought in at $60, sold a few shares for the above swap at $82, and today it sits at $105. IBM, on the other hand, has been totally flat. I initially bought in at $124, I paid $122 in the above swap, and today it sits at $123.
Oh, well. It was only three shares.