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New trade – Abbott (ABT)

(TD Account)

I bought ABT as part of the accumulation phase. The goal is to continue saving in Lending Club as long as the account reaches 10,000 dollars. Then I will start focusing more on TD account and accumulating 10,000 dollars in TD account. Then I will switch to ROTH and accumulate 5,000 dollars in the Roth account.

This stock dropped significantly in price, partially due to slower revenue and partially due to market correction. This company is a dividend achiever, continuously raising its dividends. During this drop the company didn’t decrease dividends so for me it is an accumulation signal. Since I have little cash in this account I could trade only 13 shares. I will be saving more to add more shares later as long as I reach 100 shares, which enables me to use covered calls strategy as well.

I used a buying strategy based on the following formula:

subtract day low from day high. Divide the result by 2 and add it to close. I was lowering the buy price per this calculation since Friday 19th, 2012 and this strategy helped me to avoid buying into falling stock, but only a stock which is reversing in price. The stock recently reached its support at $65. It may be now bouncing, but it should be now growing up. Time will show. If the stock stays at the recent lows I will continue accumulating.

I entered at 65.96 per share today:

10/24/2012 09:58:28 Bought 13 ABT @ 65.9599

Estimated annual dividend: $26.52
Consecutive Dividend Increase: 39 years
Dividend yield today: 3.10%
Dividend 5yr Growth: 9.63%
Dividend paid since: 1926

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