Wow! I’m shocked that it’s been six months already since I started my Snowball Experiment and this website. A few months ago, I set forth a plan to stop chasing my tail on weekly dividends – the hope being that through some magical voodoo of cosmic nonsense I’d be able to make money where others lost it.

The theory was that by scraping $100 together here or there and buying weekly-paying dividend ETFs, I would eventually come out ahead because I’m not DRIPping the payouts back into those same funds and instead putting them toward “more secure” options. Sadly, many of my monthly-paying choices are having a rough year in the share value. This is only partially mitigated by the five-plus years of steady dividend payouts.

As you can see, with dividends included, I have a net negative 10% return. If I had taken my original capital and just shoved it into the S&P 500, I’d be up 10% this year, which means I’m 20% off the mark. Here’s the deal though: this experiment was never about pure gains; it was about creating a passive income machine that could eventually provide a monthly paycheck through strong, reliable funds.

Even MAIN is up there showing a loss right now, and it’s considered a very stable monthly-paying stock. Not to mention that, in the long term, all the weekly paying funds will eventually go away; 100% of their dividends are currently going toward buying the other funds on the list.

I also want to point out the PFLT is in an error state, it’s not a $0 balance, google finance is just struggling to pull the correct data. Current price is $7.11, put my position at $661.23, down $200 from my original price. This actually moves us to negative 8% instead of 10%.

Based on the current dividend rates, the far right column should be able to green up in a little over a year if prices don’t plummet even further. This was always the plan regarding funds like OXSQ and EARN. Though, it is very frustrating to know that just following my core IPS would have made me $2,500 instead of sitting at a loss. That is why this was always labeled an experiment.

Covered calls, on the hand, are sitting at around $440 in profit over 12 weeks. While premiums collected are $1,582, I lost $94 when I tried to learn how to roll a position in week 4, and I lost $820 when a strike got called away – a possibility I recognized, but risked it anyway. These setbacks are about learning. There is money to be made using covered calls, but I’ll only get smarter about it the more I practice and learn from them.

I’m going to continue to move forward with these plans. I don’t see any value in “cutting losses” and putting the money into other things. For example, EARN will produce $151 per month in dividends. That means in nine months, if the price holds steady, the cumulative gain will cross into the green. If the price goes up again, it will happen even sooner. YieldMax traps will likely tank, reverse split, and produce true losses over time, but as long as I’m not DRIPping into them, I don’t think the outcome will be as negative as just rolling the dividends into the other funds.

The experiments will continue. I will still prioritize debt repayment at this time over more stock purchases, though I am going to split some of those dividends into purchases. I can’t wait to see where this goes over the next six months.

I was going to close this out but then I realized I wanted to do some quick math. I’ve put $10,423.93 into EARN. Assuming I ignore the fluctuating share value and they maintain their $0.08 monthly dividend, it will take 69 months of dividends to pay out what was paid in. That breaks down to five years and nine months. Only time will tell.

~~Miniwing~~
Investor, Stoic, Parent