Arborbridge wrote:IanTHughes wrote:Clitheroekid wrote:I've not read the thread, so sorry if it's been mentioned before, but amongst the squeals of joy from those who have obtained an unexpected windfall there must be quite a few shareholders who are feeling less than chuffed.
I was surprised to see that the GNK share price was as high as £11.83 back in 2007, and even as recently as the end of 2015 it was pushing £10. There must therefore be a few long term holders who paid more than the bid price, and who will consequently be looking at a capital loss.
You should first adjust the 2007 price you quoted for the 3 for 5 Rights Issue in the second half of 2009. But even when you do, anyone buying at such a high price would not be buying High Yield, which is after all the modus operandi of HYP and the subject of this board. The same goes for 2015 when, if you had bought at £10, you would have been buying a yield of little more than 2%, hardly HYP territory!
Nevertheless, Clitheroekids point is valid and not all shareholders are high yield buyers. Although I'm ok on this one, I have been in the position he mentions. One does feel hard done by when everyone else is saying what a wonderful premium it is. "Oh no it's not!" such a shareholder would think, " It's daylight robbery. Just leave my shareholding to recover, thank you very much."
Well, yes and no!
According to my records, on 4 Dec 2015, the price of Greene King PLC (GNK) peaked at 977.50p. So on the face of it, a purchase at that peak price would now be looking at a loss of 127.50p. However, any holding bought on that day would also have now received 4 years of dividends - including the one that is currently ex-dividend - totalling 131.65p. OK, not an advert for an ace portfolio manager but only a small loss against inflation and remember, only because the purchase was made at the absolute peak price, a price not seen before or since!
All holdings bought before that date – 4 Dec 2015 – would have benefitted from less capital loss with most showing a capital gain and many having received more dividends since purchase. All holdings bought after that date – 4 Dec 2015 – would have benefitted from less capital loss or of course, latterly, a thumping capital gain, depending on exactly when the purchase was made.
Virtually no-one would be nursing even a small loss overall!
I know, I should get a life!
Ian