LIC & LIT Listed Investment Companies (LICs) Q1 2018

Discussion in 'Shares & Funds' started by The Falcon, 1st Jan, 2018.

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  1. The Falcon

    The Falcon Well-Known Member

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    Because these products arent mark to market - they are unlisted assets that are “worth” what the manager says they are. Until they have to close the fund and sell off the assets of course....then the surprise. This type of thing is an easy scam to run, overstate asset value each year (performance), good returns lead to inflows, any redemptions (rare) are easily dealt with. The problem is you have a snowball effect whereby at the end you have huge overstatement of asset value and it will stand out.

    My view is that Alts are a mirage for the individual investor. I looked at it a bit and came to that conclusion, I didn’t even really consider the manager risk issue at the time.
     
    Last edited: 29th Mar, 2018
    The Falcon, 29th Mar, 2018
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  2. jprops

    jprops Well-Known Member

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    Bernie Madoff. Excellent interview with the guy who saw through the numbers, before it crumbled in the GFC
    21 - Ponzi Hunters: Harry Markopolos And His Dogs Of Fraud - Adventures In Finance: A Real Vision Podcast (podcast)
     
    jprops, 29th Mar, 2018
    #942
  3. Snowball

    Snowball Well-Known Member

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    Thanks Falcon. But for a long track record it becomes harder to do, or so I would’ve thought.

    The unlisted funds would have to pay our capital gains on assets realised and given they don’t seem to hold the businesses etc for lengthy periods I would’ve thought this would come out over such s period.

    I get how they’re able to do it, but the length of time and extent seems unusual because they don’t hold everything long term.

    They tend to have target exit dates for most investments and they mostly tend to be 5 years or so in nature (according to their communications), hence my confusion they can hide proper asset value indefinitely.

    Most of their clients are high net worth and institutions as far as I know, so they’ll have a lot of angry deep pocketed people on their hands. Could be lawsuits galore?
     
    Snowball, 29th Mar, 2018
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  4. Nodrog

    Nodrog Well-Known Member

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    @Snowball, shame on you. Off to the naughty corner of the room for the whole day:D.
     
    Nodrog, 29th Mar, 2018
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  5. Nodrog

    Nodrog Well-Known Member

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    Nodrog, 29th Mar, 2018
    #945
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  6. Blacky

    Blacky Well-Known Member

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    Topped up MLT, BKI and CBA on this dip.

    Still have a bit left in the tank and looking at SOL, +1 more.

    Blacky
     
    Blacky, 29th Mar, 2018
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  7. Louis XIII

    Louis XIII Active Member

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    Louis XIII, 29th Mar, 2018
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  8. @FruitCake@

    @FruitCake@ Well-Known Member

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    @FruitCake@, 29th Mar, 2018
    #948
  9. Intrigued_again

    Intrigued_again Well-Known Member

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    That time of year again LOL
     
    Intrigued_again, 29th Mar, 2018
    #949
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  10. Nodrog

    Nodrog Well-Known Member

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    Nodrog, 29th Mar, 2018
    #950
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  11. Nodrog

    Nodrog Well-Known Member

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    IA you’ve been quiet for awhile. Have you sold CBA and the rest to invest in index funds also:)?

    {Note - thread continues here: Listed Investment Companies (LICs) Q2 2018}
     
    Last edited by a moderator: 1st May, 2018
    Nodrog, 29th Mar, 2018
    #951
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