On Friday, 30/11/2012, TGA had what is probably a record turnover - namely, 4,007,144 (almost 3%) shares at $7,516,467, of which 2,903,329 shares were traded after 4:00 PM for $5,443,026.77. This is circa ten times TGA's typical daily volume. What all this means, and whether 30/11/2012 being the end of a week and effectively the end of November, I do not know, because for all those who wanted out, there were, in share volume terms, others who wanted in, which is a platitude, being by definition true.
What I would like to know is, is the population of buyers different to the population of sellers, other than the fact that the former want to exit, and the latter want to enter? To put words in your mouth, are (on balance) traders selling and investors buying, or is that simply what I want to believe as a significant holder who wants to believe in TGA?
I have just been offered $200,000 by CBA at 5.9% as a mortgage to buy a unit for my personal use, so I assume CBA's depositors get less as a return. TGA's yield at current SP is about 5%, so with franking credits considered, it is about 7%. Because most of my income is a tax-free pension from my SMSF, I pay a low marginal tax on TGA shares that I hold personally, so assume that after tax the dividend plus franking credits are worth about the same as the mortgage, about 6%. I could sell $200,000 worth of personally-held TGA, and obviate the need for that mortgage, but on balance, I think I'll hold TGA, and take up the mortgage. Obviously, if one believed that hence forward TGA is going to go backwards, one could be tempted to go the other way in this situation.
In my view, TGA has deteriorated from the perception I had of it a year ago, but then alternative investments have also deteriorated, including interst on bank deposits, so relatively, things have not changed for me, and I continue to hold TGA. It will grow over the next five years, but at a lower rate than the past five years.
TGA Price at posting:
$1.88 Sentiment: Buy Disclosure: Held
