One of the goals of my input to our stock portfolio is to have sufficient cash flow from interest and dividends alone to support my wife when I punch out. I use this term not as in an injection from an aircraft, but as leaving life as it’s known on earth. Recently, I went to work, rationalizing several stocks and reinvesting them in HRZN, which currently has an over 20% return. This blog takes you through how I checked HRZN out before pushing the go button on the investment, which currently stands at 3000 shares.
Our broker, Schwab, offers many research-oriented pathways. This is the first area I explored upon the start of my initial due diligence. One such report on HRZN in PDF format is presented below for information. I gleaned from this type of info that, in general, the purchase of HRZN was not recommended, but being a contrarian, I noted that the price appeared to be bottoming out. This, in and of itself, presents an opportunity. I also observed that HRZN was a consistent payer of its monthly dividend, without any reductions. To me, this was an opportunity to buy at or near the dip and maximize potential returns.
I then turned to Perplexity.ai with numerous prompts.
I am attempting to maximize short-term dividend returns. Would you buy HRZN, all risks aside
Suppose the sole objective is to maximize dividend return in the short term, and all risks are ignored. In that case, HRZN is an unusually strong candidate based on its current forward yield (about 20% at $0.11/month and ~$6.68/share) and its consistent history of monthly payouts. This high yield is well above that of most dividend stocks or funds, and monthly compounding via DRIP further enhances short-term income.
However, such high yields are rarely sustainable and often signal underlying risk, such as the potential for dividend cuts, portfolio losses, or share price erosion. But with risk disregarded, HRZN offers unusually rapid dividend accumulation and cash yield, making it one of the best vehicles for short-term dividend maximization among widely available equities.
I am OK with the risks involved, having owned HRZN several times previously and having bought 3000 shares at various prices, as low as $6.44. Given the investment of slightly over $18,000, I then turned back to Perplexity with additional queries. One is shown in the PDF below:
At the point I had accumulated 1000 shares, I did another query about accumulation as shown in the PDF below;
Of interest to me is how long it will take my investment to double? See PDf below.
I invested most of my money in HRZN before its ex-dividend date in November, so I should receive the first dividend payment shortly. The price has eroded somewhat to the point I’m currently down a couple of grand, but ups and downs are part of the game. I am in this for dividends, which are independent of price fluctuations once purchased.
Leave a Reply