Bank shares
Depositing money into a bank will get you 2% but buying bank shares will get you more than 3%. Even if the share price falls, the yield (based on purchase price) will still be better especially if you include dividend imputation.
When ANZ fell below the placement price, I purchased a lot of it. But it continued to tumble. Today, I bought the maximum allowed with the SPP which will be below what I recently purchased at about $29.50.
I also purchased WBC and CBA recently and also topped up another lot of CBA with its rights issue. That is it, I will lay off bank shares unless there are special reason to buy.
Everyone would wish they bought OSH recently instead! Today WPL made a bid for it...
posted by Club Mulgoa @ 1:58 AM
3 Comments:
Isn't it incredible that some idiots sold off CBA at $2.55 lower yesterday than what it closed at today. The same idiocy applies to the other 3 big banks. These fund managers are just trading shares at other people's expense and getting paid big money for doing a silly job!
The has been nothing seriously wrong with Aussie banks. So when it was dropping, I have been topping them up. At first, I felt smart, then I felt dumb, and now I feel smart again. But even if tomorrow it falls again, it will be the bunch of idiots who are selling. In the long term, there is nothing wrong with bank shares... especially the Big Fours.
Today, there will be crunch because we are the poodles of American stock market. Whenever, the Yankees worry, we suffer the sickness.
Today in The Australian, one commentator interviewed a few large fund managers in Australia and declared that the bottom of the bank shares (down 20% from its peak) has been reached. And with its dividend at 8-9% (taking dividend imputation into account) against taxable 3% interest for deposits, the choice is obvious.
Most of my recent share purchases have been bank shares in ANZ, CBA and WBC.
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