Posted by kcchongnz > 2015-10-28 17:17 | Report Abuse

Good work.

I have a few comments

1) I have some different number on CAGR. May be you could check your calculations. Basing on your price and dividend data, my figures are:

Company Initial price Final price Capital gain Dividend Total gain Gain% CAGR
SHL 1.48 3.12 1.64 1.34 2.98 201% 11.7%
Spritzer 0.91 1.94 1.03 0.515 1.545 170% 7.9%
Lysaght 1.00 3.52 2.52 1.475 3.995 400% 17.5%
Yee Lee 1.64 1.85 0.21 0.52 0.73 44.5% 3.8%
Scientex 0.63 7.67 7.04 1.965 9.005 1429% 31.4%

2) The average CAGR is 14.4%, way outperformed the KLCI's (including dividend) CAGR of 9% during the same period.

The 5.4% difference, and compounded over 10 years, makes a hell of difference.

For example, If you have invested RM100,000 into a portfolio of those stocks above 10 years ago, it becomes 384k, compared to 240k if you just invest in the 30 stocks in KLCI.

3) If you compute the future value of dividends to year 10, say just put in FD at 3%, the CAGR will be more.

Dividend yield investment strategy does seem to work for your stocks too.

Posted by shinado > 2015-10-28 17:35 | Report Abuse

hi kcchongnz, thank you for your comments. As to reply your comment no. 1, I get the output from a CAGR calculator from this site: http://www.miniwebtool.com/cagr-calculator/
Do let me know if the calculator is wrong, thanks!

Posted by NDarvas > 2015-10-28 17:40 | Report Abuse

Good Work.Appreciate all the sharing from you and kcchongnz.

Posted by kcchongnz > 2015-10-28 17:42 | Report Abuse

Yes, I checked again and I think my calculations are correct, except I made a mistake for Spritzer which should be a CAGR of 10.4%.

Company Initial price Final price Capital gain Dividend Total gain Gain% CAGR
SHL 1.48 3.12 1.64 1.34 2.98 201% 11.7%
Spritzer 0.91 1.94 1.03 0.515 1.545 170% 10.4%
Lysaght 1.00 3.52 2.52 1.475 3.995 400% 17.5%
Yee Lee 1.64 1.85 0.21 0.52 0.73 44.5% 3.8%
Scientex 0.63 7.67 7.04 1.965 9.005 1429% 31.4%

Average 14.9%

The average CAGR of the portfolio is 14.9%. You could have keyed in some wrong inputs.

Posted by kcchongnz > 2015-10-28 17:46 | Report Abuse

Use this in your spreadsheet to calculate

CAGR = (EV / BV)1 / n – 1

Where:

EV = Investment's ending value
BV = Investment's beginning value
n = Number of periods (months, years, etc.)

Posted by shinado > 2015-10-28 19:48 | Report Abuse

kcchongnz Thanks for the formula, but I think your CAGR is calculated based on 10 years, while mine is 16 years. So I believe my CAGR should still stand corrected. Am I right?

Posted by jacky > 2015-10-28 20:45 | Report Abuse

i checked. shinado correct

Posted by calvintaneng > 2015-10-28 23:48 | Report Abuse

White Horse is another Very Solid Dividend Paying Growth Stock.

Increasing NTA

Increasing Profit.

Consistent Dividend.

It has the potential like Scientex.

In Jubin Tiles Warehouse, Taman Daya, Johore today the Sales people said that there is huge orders of Both White Horse & Yilai tiles from Pengerang's RAPID Massive Developments.

The competition from China or Vietnam tiles import are negated by

1) Crashing Ringgit Value. Now China & Vietnam tiles are priced 20% to 30% more than Malaysian tiles

2) Both White Horse & Yilai factories located in Iskandar. So cheaper transport cost.

So White Horse & Yilai tiles are selling well as The Massive Condos Project in Johor & Pengerang's RAPID Will Be Using Unheard of Mountains of Tiles in Iskandar!

Expect White Horse To Gallop & Gallop Faster than others in coming years!

Posted by kcchongnz > 2015-10-29 03:36 | Report Abuse

Why did I think of 10 years?
Yeah, my CAGR calculations are not correct then.


Then the dividend stocks do not seem to provide better return than the broad market.

But that is also because you assumed those dividends received were consumed, and not reinvested in any form. If they are invested, the CAGR would be more.

One way to do is to use internal rate of return to calculate the rate of return.

Posted by shinado > 2015-10-29 07:12 | Report Abuse

And not to forget that other factors such as bonus issue and share split was not taken into consideration. I would still think of it as a decent return.

Posted by shinado > 2015-10-29 07:42 | Report Abuse

Will I be using dividend investing solely for my portfolio? No. But with this back-testing result, it gives me an idea to incorporate maybe one or two dividend stocks into my current portfolio especially during these tough times which can be full of uncertainty.

I would like to think of it as part of a 'Margin of Safety' although I know that's not how it really means. At least you can fall back to dividend gains when prices go down south.

Posted by Kevin Wong > 2015-10-29 09:55 | Report Abuse

In stock investing...over the long term, the slow and patient tortoise do often beat the quick and haughty hare

Posted by Jester > 2015-10-29 11:33 | Report Abuse

Good work shinado. A good read for a novice investor like me.

Thanks~

Posted by shinado > 2015-10-29 11:45 | Report Abuse

Jester, I'm in no position to teach. I'm a learner just like you :)

Posted by Kevin Wong > 2015-10-30 10:29 | Report Abuse

After 21 years in mkt, i'm still learning
Good luck everybody!

Posted by Thong Wing Hoong > 2015-11-10 15:55 | Report Abuse

thanks for sharing shinado...keep posting!