LIC & LIT Listed Investment Companies (LICs) 2022

My reasons for selling are: high fees, my lack of strong conviction to stay invested for another 5-10 years to wait for a turnaround, and the amount invested as % of the non-super stock portfolio/overall investable assets are minimal to make a huge impact. Who knows with high inflation, there’s talk about the return of value over growth.

The first 5 years of my stock investing journey I was so interested in investing as it was new for me and I wanted to reach certain asset level, but lately for some reasons I prefer to spend my time and energy on optimising well-being and enjoying life more. I recognise that I still don’t know much about investing and just accept that.

I do enjoy the discussions on PC though.

 

I really like that and, in particular, your last sentence. I say this in a positive way but reached the understanding of our own incompetence and acknowledging it as well as not overestimating our performance. And being able to accept that.

 

I hold both MIR & AMH and am a happy holder and both and continue to add to them.. MIR makes up a decent portion of my AU portfolio ~20%

 

............which doesn't consist of banks, big mining, banks and more big mining.

 

I also own AMH and am a very happy holder. It's a very unusual LIC and I like it very much. It used to be unloved, trading at significant discounts to nta, but it looks like people have noticed it.
Now that I think of it, a very big chunk of my portfolio is invested in the AFIC stable of Lics, and I am very happy about that.

 

I have always wondered why none of the older LICS like WHF,ARG etc have not launched similar strategies around mid/small cap? surely the appetite is there?

 

I held AMH for a number of years but sold it to cut down the number of holdings. As it only pays once/year I decided it didn't suit me. (yeah, I'm greedy, give me the money ).

 

In regard to ARG, I think the management's view is to do that internally. From the 2021 Annual Report (Page5)



Of course, with 90 companies in total, it isn't as extensive compared with MIR.

 

US numbers. 2021 was better for value than it was for growth.



Growth still has a large pricing multiple. value, not so much, but not cheap on an absolutely basis either. Out-performance going forward could be value simply falls less in a re-pricing driven bear market, similar to its out-performance period post 2000. Once the current positive market sentiment is pierced then its reasonable to expect a re-pricing period for everything. The less surety of future cash flows, the higher the starting valuation, the greater the impact from loss of sentiment.

 

Time for value stocks?

 

Millennials turn to old-school ASX stalwarts

 

AFI - NAV = $7.76 and Stock price now $8.54 so premium of $0.78 which is about 10% ...for past yield of 24c or 2.81% gross .... ! UBank saving may beat it once reserve bank start increasing rates !

 

Yeah, the vagaries of the market. It's supposed to be forward looking yet the NTA is backward looking.

Some meditation is necessary

 

Yeah I also think that is a bit weird for AMH for some reason I would also prefer twice a year distributions

MIR trading at a lower premium than AFI.. wow ha-ha

 

We are soon to have one very, very distraught member of this forum.

"One of Australia’s biggest poultry suppliers, Ingham’s, says severe staff shortages caused by the current COVID-19 outbreak has halted production of some items and resulted in lower manufacturing volumes."

 

I just knew I shouldn't have sold PMC!!!

 

The poultry index will be plucked!!!

 

I agree that's the most likely scenario. When I look at the specific holdings in value ETFs it’s hard to see those companies significantly increasing their earnings or multiples - which would drive prices higher - mostly (cheap) boring stuff - sometimes bordering on junk (yes MYR in AVDV I'm looking at you). Continued higher inflation for industries/companies that are price makers (rather than takers) might assist on the earnings side. My understanding is that the benefit comes from the effects of systematic and disciplined rebalancing across total asset allocations. "Invest in value - equity exposure and it's less determinantal to your long-term wealth than cash". Doesn’t sound as good as the "Value Premium" does it

 

The juice probably isn't worth the squeeze for absolute MER / directors fees to be collected. Something for the "young guns" and disruptors to launch.

 

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