JamesMuenchen wrote:Pastcaring wrote: Leave it alone for 30 years and reinvest all dividends.This gives around 6000 shares in each company after 30 years,that is variable,could be a few more ,could be a few less.
That implies a yield of ~6.5% being reinvested. Your MQG yield is ~4% which would compound to only 3118 shares. More than "a few less" in my book.Pastcaring wrote:
MQG,as I said if I had to pick one stock that would be it,not a bad year$105 when I used it to explain the one day short strategy,closed at $132.80 today,throw in a $5 .35 dividend and around 31% return for the year.
CBA not so good,as I said bought at $ 72.5almomter a 3 ish year downward trend from $96, well added to the portfolio as I have held them since around 1991. Closed at $71.40 today,throw in a $4.31 dividend and 4.4% return for the year.
Across the two a 20% return for the year
Do a simple compounding calculation at various returns.Don' t dream that 20% annual will continue,it will not.
At 8% that is$1.79 million.
At 9% $ 2.38 million.
At 10% $3.43 million
I think your simple calculation is double counting the divi in both the return and the number of shares?
Otherwise your minimum expectation is 30 years of 8% share price appreciation +6.5% divi?
Made my day,wonderful,you did some thinking and cracked it
I' ll get back to you,busy at the moment.You are right.MQG is compounding at around 4% .
The double counting,slightly off,easy mistake.Growth in shareholding 6% annual.Growth in share price 6% annual.Whatever number you think is a fair compounding rate,you are in charge.
Thankyou for making me think,I am just so lazy.
The error for MQG occurred because I forgot they had a rights issue around 2015.They bought an aircraft leasing company,perhaps sold out of Thames water( UK ).
Last year the growth rate on the shares was 4.7%.The company web site will give you the info.
Started the year with 1000 shares,ended the year with 1047 shares.Started the year with a share price of $105, ended at around $130.Their year is 1 April until 31 March.Price has come down to around $125 now from the recent record of $136.Tomorrow the price goes down again,it goes XD,I think $3.20.I don' t look,too much work for me.The one day short.
I get a few extra shares,money into my bank account,then I wake up in August,CBA results come out.
CBA operate on 1 July to 30 june year.They have returned pretty much bang on 6% shareholding growth for the past year ,as of today.Wait until 30 June to calculate exact results.Start the year with 1000 shares,you now have 1059 shares and money carried forward to August.Share price as of today is around $75.40,no 6% growth.Check it on 30 June.
On long term from 1990 to now CBA should be $36 approx,calculating @ 6% compounding.If it was $36 I would be happy ,it did better than I thought it would.The shareholding grows at the same 6% compounding.Over 30 years 6000 shares.
6000 shares x $36 great growth.I got 6000 x $ 75, even better.I thought dividend would be around $3.Dividend is $ 4.31.
From listing until now CBA has roughly outperformed / performed the same as BRK.I am very happy with that,some going over 30 years almost.Issue price $ 5.40,I round that to $6.
MQG ,I think was listed in 1997.Around $7 I think,I didn' t buy any until they hit $60 in 2006.I thought it was a bubble the price was growing so fast.
From 2001 then the annual report for MQG gives a price of $22 on 31/3/01.Compound from that date at 4% shareholding growth,and 6% price growth for 30 years.Or do the same from my purchase price of $60 or last year at $105.I would think the law of big numbers will kick in.
MQG also spun out Sydney airport around 2015/16.So from that date on you would be running with shares in MQG and I think it is SYD.I sold my SYD as they had a sale facility.I have never looked at SYD but I think it has done well since then
Sorry for the error,I totally forgot about the rights issue and the SYD spin off.The rights issue skews the figures to just less than 6%. 4% is a much better figure to compound at.
Thanks again for making me think.Now for the rest of your life spend 1 minute per year checking on those two companies.That will probably be slightly more time than I will spend on them.
You did the hard bit and thought about about the info presented.Seems a shame not to check it once a year.