What happened to the AMP share price?
Shares of AMP Ltd [ASX:AMP] slumped more than 2.3% today as the broader Aussie market also fell.
Why did AMP shares fall?
There isn’t much to explain AMP’s big price fall today, except for the fact that many stocks in the financial and funds management industry have also fallen, including the four major banks.
The biggest reason for AMP’s price fall could be due to the ex-dividend date to qualify for the next dividend. That was last Wednesday.
AMP has had a rough time of it over the past year, as have its shareholders. Now that the latest dividend is in the bag, it’s likely that many investors will have used this opportunity as the time to sell.
The stock had rallied from a recent low of around $4.42 last November, to a recent high of $5.32 in January. But, since then, the stock has fallen back.
AMP is certainly a mature business, with seemingly few opportunities for long-term growth. For that reason, it’s perhaps not surprising that many investors are taking the opportunity to cash-in and watch from the sidelines.
What now for AMP Ltd?
AMP pays a 7.7% grossed-up dividend, which, on the surface, is quite attractive. However, investors tend to want some prospect of growth alongside dividends. Unfortunately, investors in AMP have seen very little in the way of growth in recent years — certainly not enough to justify the highly-volatile nature of the stock.
For that reason, when compared to the many other investments available on the ASX, we can understand why many investors would rather ignore AMP in favour of investments elsewhere.
By Kris Sayce