Shares for my kids - couple of questions?

[Trogdor]

This is a clunky graph, and the XJO is based at 500 compared to the accumulation index at 1000, too lazy to go back and do it again, but you should get the idea. Start December 1979.

The power of dividends and why you should never aim to just track the XAO or XJO.

I love that graph...

Now can you do a third one, which is an accumulation index, adjusted for tax at say 46.5% (and taking into account franking credits). I'd be interested to see where in the middle (ie closed to which line) it lies.

 

[Andrew_A]

Well I could.

If your point is that tax will not allow you to achieve the returns shown by the graph? I agree.

I think I have spent enough graph time on this thread, I don't even have any kids yet!

 

[Trogdor]

Well I could.

If your point is that tax will not allow you to achieve the returns shown by the graph? I agree.

I think I have spent enough graph time on this thread, I don't even have any kids yet!

Hi Andrew, I think its pretty trite to contend that it lowers the return - I wasnt doing that.

I was more asking the question as to how much lower it would be. The graph is a powerful visual aid to highlight compounding. But I was wondering if the effect of tax over decades would put the new line closer to the top or bottom lines, or right in the middle.

It would be a very interesting graph I think!!