Old NAB can't even get a day rally when it's cum dividend and goes ex tomorrow. There are still brokers like Mike Hefferman promoting the idea today that a buy of NAB before tomorrow will win you three fully franked dividends in 13 months. Grossed up the fully franked NAB div is about 10%, yet it is still down 3c and has been down as far as 15c today. The interim dividend will be 90c ff. When ANZ was cum dividend on May 9th it rose a bit on the day with the prospect of 66c interim div ahead; then next day when it was ex div it fell a dollar. By May 25th it made a low that was just shy of $3 below the cum dividend price. Buy for 66c div, hold for a $3 paper capital loss. So a fall bigger than the dividend can be expected for NAB tomorrow, and probably more down in the weeks to follow . Somewhere down the track, maybe after the Australian real estate wave has spent itself upon the sands, the banks will be a safe yielding buy.
The scary part is we re not even sure where we are in the property cycle, if the doom and gloomers are right and we fall like the US, you can expect bans to be one of the heaviest hit.
Yes, very hard to make a call on the banks, even with their nice dividends. I prefer to look for yield stocks that are not exposed to property or to the wholesale credit markets. If the scene deteriorates and banks crash I'd be looking to pick a few up then. Currently only have a reduced old holding in Westpac (WBC)
Five years ago people used to watch bank stocks worldwide to see how the value of their investment goes up, but today they watch bank stocks to see if their deposit is still safe with them.
I'm even more wondering and watch the bank to see if my safe deposit is still safe. Anyone could suggest a good Vault company around CBD Sydeny?
If you guys distrust the banks so much and have stuff you want to store why not simply build your own facility or buy a really heavy safe? IMO if your not holding Bank Stocks for the yield then your too busy holding something else.
