Retail shareholders who favour Australia's biggest companies have missed out on the growth in the wider sharemarket.
The nine most widely held stocks have returned, on average, only 7.5 per cent for the year to August 31, this year, compared with the return of the wider Australian sharemarket of 16 per cent.
The returns are "total" returns that take into account not just the change in share price but also the dividends paid to shareholders.
Big falls in the share prices of Telstra – the most widely held stock with 1.4 million shareholders – and the poor share price performance of the besieged wealth manager, AMP, have held mum and dad shareholders back.
The poor return for small investors comes despite a strong season of profit reports.
Analysis by CommSec suggests that for the year to June 30, 2018, the combined profits of the 200 largest listed companies rose 8.4 per cent on the previous financial year.
Craig James, the chief economist at CommSec, says the main reasons for the underperformance of mum-and-dad stocks include the good performance of smaller-capitalised stocks as well as those that are more globally dependent.
"The lower Aussie dollar and stronger global economy has supported exporters and companies with significant foreign operations," James says.
"Banks, insurance and telco stocks, which are favoured by small investors, have under-performed over the past year.
"While materials, energy, food and technology are among the winners."
AMP in the news
Result: Its six-month profit to June 30, 2018, fell 74 per cent to $115 million due to impairment linked to its financial planning scandal.
Key Points: The wealth manager is in the news for all the wrong reasons with revelations before the banking royal commission that it mislead the regulator among other issues.
AMP's wealth management business saw total net cash outflows of $873 million for the first half of 2018, compared to net inflows of $1.023 billion in the prior corresponding half.
Telstra facing more competition
Result: Telstra's a net profit declined 8.9 per cent to $3.53 billion for the year to June 30, with mobile revenue falling 0.4 per cent and fixed line revenue down 9.2 per cent.
Key points: Over the year, 342,000 retail customers, 88,000 retail fixed broadband customers and 135,000 retail bundles were added, but the company is facing increasing competition as the NBN is rolled out.
CBA hit by costs
Result: Australia's biggest bank reported a 5 per cent drop in profits to $9.2 billion for the year to June 30, which was dragged down by more than $850 million in one-off regulatory and compliance costs.
Key points: It painted a picture of "subdued" conditions in retail banking. And there could be further fallout for the bank from the banking royal commission, which will hand down its final recommendations in February.
Woolworths outguns Coles
Result: Woolworths reported a 12.5 per cent jump in net profit to $1.75 billion for the year to June 24, from $1.5 billion last year.
Key Points: Woolworths has now outperformed Coles on comparable sales growth for seven consecutive quarters.
Qantas flies high
Result: The flying kangaroo posted a 14 per cent rise in underlying profit before tax $1.6 billion for the year to June 30, 2018, from $1.4 billion for the previous financial year.
Key points: Qantas International's earnings rose by 7 per cent to $399 million and its earnings from domestic operations jumped by 25 per cent to $1.1 billion.
Suncorp beats expectations
Result: Cash earnings fell 4 per cent to $1.1 billion in the year to June 30, 2018, but that was better than analysts were expecting.
Key points: Suncorp flagged it would offload its life business for $725 million to Japan's TAL Dai-ichi Life and return $600 million of that to shareholders.
IAG to offload Asian assets
Result: The insurance giant's net profit for the year to June 30, 2018, fell to $923 million from $929 million last year after higher tax liabilities and softer investment results.
Key points: The general insurers key brands include NRMA, SGIO, SGIC, CGU and Swann Insurance. Asset sales in Thailand, Indonesia and Vietnam will allow the insurer to return 25 cents per share to shareholders.
Wesfarmers to spin-off Coles
Result: Wesfarmers posted a 58.3 per cent fall in net profit to $1,197 million for the year to June 30, 2018, and was weighed down by $1.4 billion in write-downs and charges as it navigates a period of transition. Coles full-year earnings before interest, tax and depreciation fell 6.8 per cent to $1.5 billion.
Key points: Wesfarmers will spin-off Coles as a separate company and Wesfarmers' shareholders will receive shares in the company with the supermarket posting its best sales results in almost two years.
Tabcorp's merger pays-off
Results: Gaming giant Tabcorp has swung back to a $28.7 million profit for the year to June 30, 2018, in a messy result following its recent merger with rival Tatts Group.
Key points: The merger with Tatts Group is helping to deliver strong growth in its online betting business and online lotteries business.