Morning Report Thursday 18 December 2014
Generally, switching banks over the years has been a trade that has benefited brokers with commissions more than investors with returns. When we look at the “Big 4” Australian banks over the last decade (chart 1), the main standout was National Bank (NAB) in 2007, selling was wise, as was being significantly overweight Commonwealth Bank (CBA). This trend has continued robustly over the last 12 months. Unfortunately, this is another example that investing too much money purely behind analysts’ opinions is fraught with danger.
Below shows what percentage of analysts has each bank as a buy, almost a reverse indicator!
• ANZ – 60%, CBA – 16%, NAB - 45% and WBC – 21% - sourced from Bloomberg this morning.
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