Commonwealth Bank of Australia (ASX: CBA) shares are a popular option for investors, with the banking giant featuring in millions of portfolios across the country.
In fact, almost half of Australia owns CBA shares either directly or indirectly. When commenting on its dividend last month, the bank said:
We have increased our dividend payout ratio, improving shareholder returns and benefitting more than 12 million Australians who own CBA shares either directly or through their superannuation holdings.
So, it's fair to say that the performance of the bank's shares has a major impact on the wealth of the nation.
But has that impact been good or bad since the start of the year? Let's take a look at what a $5,000 investment at the end of 2023 would have turned into today.
$5,000 invested in CBA shares
Firstly, this big four bank's shares ended last year trading at $111.80.
This means that for an investment of $5,031, I could have picked up 45 shares in the bank.
Unfortunately, the banking sector came under pressure last week, which has dragged CBA and the rest of the big four down from 52-week highs or better.
For example, the CBA share price hit a record high of $121.55 on 8 March. At that point, my 45 shares would have been worth $5,469.75. That an impressive return of 8.7% or approximately $440 in the space of two and a bit months.
But following the pullback, the bank's shares are now fetching $115.54. This gives my holding a market value of $5,199.30, which restricts the return to 3.3% or approximately $170.
Don't forget the dividends
But wait, there's more on the way. While I can't say what the CBA share price will do in the next couple of weeks, I can predict with certainty an impending pay check.
When the bank released its results last month, it declared a fully franked interim dividend of $2.15 per share. That is due to be paid to eligible shareholders at the end of the month on 28 March.
My 45 CBA shares will provide me with an income boost of $96.75 in dividends on pay day.
Overall, not a bad little earner for investors in 2024. Here's hoping the remainder of 2024 will be just as fruitful for its 12 million shareholders.
