LIC & LIT Listed Investment Companies (LICs) 2020

Discussion in 'Shares & Funds' started by RogTheBear, 1st Jan, 2020.

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  1. DoggaPP

    DoggaPP Well-Known Member

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    This. Although a broad-brush statement, it certainly shows just how small and undiversified the Australian market is and how defenseless it is in certain circumstances.

    I thought my investment journey had reached a stable point after moving from individual speculating, to reading Thornhill and going across to LICs, then to reading Bogle's little red book and converting LIC's across to VAS and from thence backing away from my propensity to fiddle and thus choosing to go with the Vanguard Australian wholesale fund. I thought this was it for me and was 100% content for quite some time. But no. Even as an index investor I am now fully realising how much I a missing by not embracing an indexed global approach.

    The journey continues.....
     
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  2. PKFFW

    PKFFW Well-Known Member

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    And yet VAS outperformed most professional trader's portfolios over the last 4 years. Admittedly, not as much as HACK or NDQ did but since I can't go back in time to always choose the best performing stocks or ETFs from the last 4 years to invest in, VAS and VGS will just have to do and I'll have to be content with outperforming a large majority of professionals and probably close to 100% of retail "investors".
     
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  3. SatayKing

    SatayKing Well-Known Member

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    What!? And fail to be in awe of one's own greatness?
     
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  4. TickerHound

    TickerHound Well-Known Member

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    IMHO the edge from long-term buy and hold comes from sitting tight, ignoring short-term under performance and letting compounding work over a long period of time. How you execute and optimise the details really comes down to you – your beliefs on how the world works, goals, timeframe, sleep at night factor, etc. These factors can change over time with success coming from steadfastly maintaining the edge.

    VAS isn’t as bad as some say. The banks are very profitable companies which spin off a lot of cash. The largest company now is CSL – who doesn’t want to own that? Yes, there are rubbish companies in the index – just like every index around the world. Index investing is about positive skew.

    Personally, I have a belief you shouldn’t bet against the US as a market as they have too many geopolitical advantages. Longer-term, the shift to the internet and cloud (plus other tech that hasn’t been invented yet) will mean superior growth in these companies, and most of them are in the US.

    Currently, the US Fed is pumping hard (which is a good thing), and the money is flowing into US Big Tech (QQQs) and software (plus Tesla). That’s the current trend.

    But I also know there will be times when local shares will outperform international, and vice versa. Or value will outperform growth, and vice versa. So, I’ve either incorporated this into my approach or am aware under performance will occur at times.
     
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  5. Ross36

    Ross36 Well-Known Member

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    ...and also why it mates so well with global or USA large cap indexes. The heavy weighting to materials and financials balances out nicely with their tech. Brings all of them down into the teens as a % of overall portfolio weighting along with healthcare. Diversified by country and sector, just the way I like it :).
     
  6. Heinz57

    Heinz57 Well-Known Member

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    Never looked at it that way, thanks for the perspective
     
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  7. Ross36

    Ross36 Well-Known Member

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    Personally I think it's an underrated aspect of portfolio building. We often think of currency risk and country risk but not sector risk. It's why in the past I was not a big emerging markets fan - they were big on materials which we already have plenty of exposure to. Made sense for USA investors as a sector balance though as they don't have much materials in their index. Luckily for us in Oz we balance nicely with the USA so it's an easy decision to diversify with them. A friend in Singapore struggles because their index is 40% financials, 25% REITs - two closely related sectors. They get hit hard when recessions come around.

    LIC related - that's why I'm not a huge WHF fan if used in isolation. Very long term materials vs industrials are almost even for returns, but not that strongly correlated. Taking away materials seems like doubling down on australian financials which to me is a big bet. Reading Thornhill's work it would be easy to just think WHF is the only stock you need, but personally I would not sleep well with that.
     
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  8. oracle

    oracle Well-Known Member

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    Today ARG released its full year results.

    Screen Shot 2020-08-17 at 9.42.24 am.png

    Cheers,
    Oracle.
     
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  9. SatayKing

    SatayKing Well-Known Member

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    Ta.

    Payout ratio 108% = Boo

    Increase of 8,000 shareholders = Interesting.
     
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  10. skater

    skater Well-Known Member

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    Lots of newbies with small holdings?
     
  11. Ariyahn2011

    Ariyahn2011 Well-Known Member

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    Maybe or people realise LIC's have their place to balance the ETF debate? ...
     
  12. SatayKing

    SatayKing Well-Known Member

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    I gotta get me a new abacus. This one's missing a few beads. That or I didn't have a sufficient number of coffees.

    6k not 8k. :oops:
     
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  13. monk

    monk Well-Known Member

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    If we want to get really picky, it's only 5,602:rolleyes:
     
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  14. SatayKing

    SatayKing Well-Known Member

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    Could be. It's probably a net figure too.

    Anyways let's wait for tomorrows headlines.

    "(AR)GO is now GO(NE) with a 22% profit plunge."

    Round 'em up, ya'll.
     
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  15. oracle

    oracle Well-Known Member

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    This one for you @SatayKing . Apparently, you are the only investor I know that likes DUI and invests in it as well.

    Screen Shot 2020-08-18 at 3.07.06 pm.png

    Cheers,
    Oracle.
     
  16. Player

    Player Well-Known Member

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    Maybe it was a freebie on Canva :D

    My favourite fancy website (not) is this one:

    BERKSHIRE HATHAWAY INC.

    They need not impress anyone. No full stack devs there :p
     
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  17. geoffw

    geoffw Moderator Staff Member

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    Wow. Retro!
     
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  18. SatayKing

    SatayKing Well-Known Member

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    Thanks @oracle.

    Actually, I don't necessarily like DUI or other LICs/ETFs. However, I need them because I like eating - and drinking coffee.
     
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  19. SatayKing

    SatayKing Well-Known Member

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    One important aspect @oracle. Let there be no surprise if elements of this also applies to other entities. We have been warned. :eek:

    :D
     

    Attached Files:

    • DUI.pdf
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  20. Player

    Player Well-Known Member

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    LOL

    And in case anyone doesn't like Berkshire's website design, from the bottom of their home page.........BERKSHIRE HATHAWAY INC.

    "If you have any comments about our WEB page, you can write us at the address shown above. However, due to the limited number of personnel in our corporate office, we are unable to provide a direct response." :p
     
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We provide our clients with the opportunity to select their own investments from a wide range of ASX listed securities. We provide the research to ensure your selections will achieve the goals. This is the value of advice.

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