The last time Commonwealth Bank of Australia's (ASX: CBA) shares traded this low was February 2014.
Since that time, Australia's largest bank has gone on to record a fresh all-time high just below the $97 per share mark, and then come crashing back down to today's price of just $72.56. It's down 4.1% today alone, and a whopping 25% since that all-time high was set in March this year.
For a number of years, Australia's 'Big Four' banks were the market's darlings. Not only did they generate huge returns in the form of capital gains, they also offered tantalising fully franked dividend yields, giving investors a very nice income stream in an otherwise low interest rate environment.
It's amazing how quickly things have changed since then.
While they were the stocks leading the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) to its highest levels since before the Global Financial Crisis, they're now the ones leading it to its lowest levels in more than two years.
Notably, Australia and New Zealand Banking Group (ASX: ANZ) also fell 4.4% today, while National Australia Bank Ltd. (ASX: NAB) and Westpac Banking Corp (ASX: WBC) fell 4% and 5.5%, respectively.
Although Commonwealth Bank of Australia and its three major peers are now trading at a considerable discount to their recent high levels, investors would be wise to steer clear, for now. Indeed, earnings growth in the sector has become more difficult to achieve (a trend that will likely continue for the foreseeable future), while further capital raisings could certainly become necessary.
Should that happen, you can expect further falls from Australia's biggest banks. While selling out of the banks completely mightn't be the best option, investors could certainly look to limit their exposure and ensure they maintain a well-diversified portfolio at all times.
