This is an extract from Public Bank’s latest annual report as of December 31, 2011:
“If a shareholder of Public Bank had bought 1,000 shares in Public Bank when it was listed in 1967, and assuming the shareholder had subscribed for all rights issues to date and had not sold any of the public Bank shares, he would have, at the end of 2011, 135,398 Public Bank shares worth RM1,811,625 based on the share price of Public Bank (Local) shares of RM13.38 at the end of 2011. In addition, he would have received a total gross dividend of RM776,137 whilst having only invested a capital outlay of RM48,760, including subscription for all rights issues. The dividends received and the appreciation in value translates to a remarkable compounded annual rate of return of 19.5% for each of the 44 years that this shareholder has held the shares in Public Bank since it was listed in 1967.”
The corporate mission of Public Bank is equally impressive:
“To sustain the position of being the most efficient, profitable and respected premier financial institution in Malaysia.”
The take-home message:
· Share investment is for the long term.
· Select a winner.
· Get in on the ground floor.
· Stick to it
· Go all the way.
Have you found a winner yet and are you willing to keep for the long term?
This post shows how the practice of delayed gratification pays off. 19.5% for each year is a great number. But 44 years is too long I guess... but is attainable for someone who had real financial education applied in his early 20's.
ReplyDeleteResearch, planning and sticking long enough to the plan are important keys in the finance arena.
Best regards,
Belinda