Well, it’s been 1 month since I made any Portfolio transactions.  This is quite the change from all the activity I generated in Q1.  However, while the activity level has changed, my purpose hasn’t.  I continue to try and improve my Portfolio.

In this case, I kept things fairly straightforward and simple.  I trimmed one of my existing bank stocks and added to another.  So, 1 sale and 1 purchase, both in the Financial sector.

The sale was a tad larger than the purchase, so it was a net outflow from my Portfolio.  Still, I managed to increase my forward dividend income since the stock I purchased had a bigger yield than the stock I trimmed.

Here are the details for my pair of transactions…

 

TCF Financial (TCF)

TCF is a regional bank in the U.S. upper midwest.  I initiated a position in the company last year.  Actually, my purchase was Chemical Financial (CHFC), which then merged with TCF Financial.

On 4/17/20, I sold 50 shares at $24.75/sh.  I sold a share lot I purchased on 7/22/2019.

After the SEC fee, the sale proceeds were $1,237.47.  At my sale price, TCF shares yielded 5.66%.

I ended up selling about 1/3 of my position.  My TCF share count has declined to 102.664 shares.

The sale resulted in a short-term capital loss of $810.03.

A reduction of $70.00 in annual forward dividend income also occurred with the sale.

Part of the reason for this exchange of bank shares was for tax loss harvesting – to log some capital losses for the purpose of offsetting some of the capital gains I registered with several sales earlier in the year.

 

Wells Fargo & Co. (WFC)

This was my 3rd purchase of WFC shares since I initiated my position back in January.  This purchase resulted in a good average down of my cost basis, as my previous purchases were at noticeably higher prices (above $40).

On 4/17/20, I purchased 40 shares of WFC at $28.7315/sh, for a total of $1,149.26.  My WFC share total now stands at 100.627 shares.

The stock yielded a whopping 7.10% at my purchase price (more than double my current Portfolio average of 3.19%).

This purchase resulted in the addition of $81.60 in annual forward dividend income.

With this purchase, my WFC position is now slightly larger than my TCF position from a value perspective.  Both of these bank stocks are currently in my bottom 10 of Portfolio positions.

 

Summary

Given the uncertain times, owning shares in one of the largest national banks seems to be a safer position to have than that of one of the regional banks.

Of course, I didn’t abandon my TCF postion entitrely.  Instead, I just trimmed my exposure and transitioned the funds to WFC.

In the process of the switch, I generated a capital loss that I can use to offset other capital gains I already had.

In total, it was just a single sale (TCF) and a single purchase (WFC) that I made.

The result of the two transactions was a net withdrawal from my Portfolio of $88.21.  However, my annual forward dividend income had a net increase of $11.60 thanks to WFC’s higher yield.

Since no positions were eliminated or initiated here, the number of stocks in my Portfolio remained at 51.

 

Are you sitting on any significant capital gains or losses at this point in 2020?  Please share in the comments!