On Tuesday we sold a portion of our position in Disney.
We still have a high conviction for Disney as it integrates the recently acquired Fox assets, builds out its streaming service, and implements the Disney as a Service business transformation.
You can read our full write up on the Fox/Disney deal and Disney as a Service here.
We trimmed the Disney position because, following the Fox deal, the Disney share count increased significantly for most clients that held a position. The position for most clients then swelled even further as the stock appreciated nearly 20% over the last two months.
The intro to our last dividend letter discussed the wrong financial decisions we make when emotionally charged. We like our position in Disney. It would be easy for us to let our positive emotions take over and leave the Disney position alone. But we developed rules to reduce the role our emotions play in our decision making process. One of our rules prevents us from concentrating too much in one position.
For accounts 100% invested in the dividend strategy, Disney accounted for ~7-8% of the portfolio more than double our typical position size for this strategy. Disney remains a top holding in the strategy even after Tuesday’s selling.