Today I added BP p.l.c. to my portfolio:
BP: 50 shares @ $38.93 — Dividend Yield 6.16% (initial position)
Total capital invested is $1946.50. This will add $120.00 to my yearly dividends.
Oil is currently trading near a 4 year low and I’ve picked BP among all oil companys because of the right mix between yield and stable fundamentals. Even if the payout ratio(58.5%) is relatively high compared to peer companies like XOM(36.4%) or CVX(41.8%), but it’s no comparison – risk wise – to the slaughtered drillers. If Oil continues to trade this low, I will add more oil stocks.
One crash course in “how to NOT do it” with SDRL and NADL are enough to stop adding to them and begin opening more conservative positions that wouldn’t stop paying me a dividend, even when times are rough.