Unintended Comparison between Lotto and the ASX

More than 10 years ago there was a big jackpot announced for Saturday Gold Lotto, and my workmates and I decided to buy a syndicate ticket. We each put $2 in, and bought 2 system 7s and a system 8, giving us 43 entries into the draw.

Saturday Lotto

We did not win 20 million dollars.

But perhaps we won a little, and decided to “reinvest” it. Or perhaps we just thought it would be a fun thing to do. So I collected $20 from each of them, and bought 10 weeks worth of entries. I made a Google spreadsheet to track the numbers each week, any winnings we made, and the cost of tickets. We have been playing those numbers ever since.

Our department was made redundant less than a year after we started playing, and we have relocated, quite literally, all over the planet. So now this $20 that I collect from them every 10 weeks, is a way to keep in contact over the many years we have been apart. It’s been money well spent for that alone. But very early on, after telling my brother about this, he said to me, “Give me that $20 every 10 weeks and I’ll give you a return on it.” That was never the point. But I never forgot it.

Woolworths Share Purchase Plan

My next employer was Big W, and once you get a Permanent Part Time position, they give you the opportunity to salary sacrifice $250, $500 or $1000 for the year, and use that money to buy shares in Woolworths Corporation. I jumped at the chance, and have been buying $1000 of WOW Shares since the ’13/’14 financial year.

I have recently heard about a share tracking website/app, called ShareSight. Free to use for the limited use I’ll have for it, and it allowed me to put in an “Opening Balance” for the shares I had. But that was very unsatisfying. So I went back in and put in all the entries for the share buys the company had done for me over the last 8 years. And I was delighted to see that it was “smart” enough to autofill the Dividends I received, according to the number of Shares I had. What I had was a delightful looking graph of my investments, which you’ll see below.

So I thought it might be fun to make a graph for the Lotto expenditure, and compare 8 years of buying Lotto tickets, to 8 years of buying WOW Shares. So here we go.

Lotto since July 2013

I downloaded the spreadsheet from Google Docs and deleted the columns I didn’t need. I then deleted the entries before July 1st, 2013 and made myself a graph. The red line is the cumulative amount of money in the pool, which was then spent on tickets. The blue line is winnings per week. And the green line is accumulated winnings.

8 years of Lotto

The lotto tickets started at $30 a week, and have gone up in price to $35 a week. Winnings have been anything from $20 to $220, with a “big win” of $1577 in April of 2016. The wins have totalled $6000. This means we have only had to spend $9500 over the last 8 years, to buy $15,500 in tickets.

We have nothing physical to show for the money we’ve put in, but as has been mentioned previously, I have regularly kept in touch with old friends.

WOW Shares since July 2013

This graph shows cumulative value in shares + dividends received since the first 6 shares were bought, for $212, on 27th of September, 2013.

8 years of WOW Shares

The investment has essentially been $20 a week, collected by the company and spent on WOW shares every quarter. The share price varied between $21.15 and $43.53 a share.

Woolworths gifted shares to all non casual employees during the pandemic, and I received $640 in shares last year. This meant I only had to spend $360 to receive my $1000 in shares.

Woolworths spun off the Endeavour drinks part of their business into it’s own entity, and all WOW shareholders received an equal amount of EDV shares. I received, $1726 of Endeavour Shares on July 1st, 2021.

So, I have spent $7397 in the last 8 years. Current value of Woolworths and Endeavour shares is $13,325. The shares have increased in value, giving me a capital gain of $5928. Plus, I received $1042 in total dividends paid into my bank account, and $446 in franking credits to claim back on my tax over the last 8 years. Total returns on investment (Capital Gains + Dividends + Franking Credits) is $7417. I have doubled my investment.

8 years of ASX

8 years of the ASX

In the same 8 year period, the value of the Australian Securities Exchange (essentially all the stocks in publically traded companies in Australia) increased from 4802 to 7473 points. There were mountains and valleys, including a huge drop in March last year (for some reason), but over the long term, the market increases. My returns in Woolworths are indicative of investing in the ASX as whole. There will be more on that in a future post. For the moment it’s important to remember:

Lotto – Invested $9500. Earned $6000 in wins, bought $15,500 in tickets. $0 to show for it.

WOW Shares – Invested $7400. Rose in price to $13,325. $1042 earned in Dividends. $446 received in Franking Credits. $14,813 to show for it.

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