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Listed Investment Companies (LICs)

Discussion in 'Other Asset Classes' started by The Falcon, 21st Jun, 2015.

  1. BingoMaster

    BingoMaster Well-Known Member

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    Don't be discouraged. Though it might take you a small amount of education getting started, it's really not that complicated. Follow pier's excellent post. It's straight forward, but not easy, to implement a plan like this.

    The majority of investors buy at the top and sell at the bottom, and get poor returns. Don't be one of these. You'll have to put in the very basic level of due diligence to understand this, otherwise you will be one of those who gets poor results. Charlie Munger and Buffett say if you don't have the patience to be a common stock holder, you deserve the poor returns you will get!

    Remember at the end of the day, you are responsible for your money and no one else is.
     
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  2. austing

    austing Well-Known Member

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    And from memory @OscarBravo (and reinforced in the preceding post by @BingoMaster) it was you awhile back in the Thornhill thread who stated a very important point:

    Investing is simple, but not easy!

    @Pier1 has done a magnificent job of showing that "investing is simple". But it's psychology that is one's biggest danger. That's the "but not easy" part.

    Hence take note of @Pier1's other very important suggestion and read Peter Thornhill's "Motivated Money" many times to build your conviction. Because when the next crash comes one's psychology will be in many cases severely tested. The "but not easy" will be felt to full effect. It's conviction that will save you!

    Cheers
     
    Last edited: 10th Jan, 2017
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  3. austing

    austing Well-Known Member

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    Patterson' Research 21/12/16

    http://files.clickdimensions.com/ps...2ab&esid=94544ce9-07c7-e611-90fd-0050568581cf
    @Hodor don't read the following:
     
    Last edited: 10th Jan, 2017
  4. Hodor

    Hodor Well-Known Member

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  5. austing

    austing Well-Known Member

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  6. austing

    austing Well-Known Member

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    Ah well done. So that's why you're a bit chirpier lately:D.

    I know how much you loved your mining stocks so it must have been a hard decision, NOT:).
     
  7. ErYan

    ErYan Well-Known Member

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    Therefore, if you never sell you can't sell low.
     
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  8. austing

    austing Well-Known Member

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    Exactly, provided you don't crack under pressure. Many do. Hence the saying "investing is simple, but not easy"! It's easy to get excited about the sharemarket, about potential great buying opportunities in the next crash etc but when the crash actually happens it can be a very different story. Not everyone here has experienced being heavily invested in the market during a crash. It's not easy watching your capital drop 50% even for many of us committed dividend investors. Hence why conviction is so important.

    I'm not trying to be negative but just encouraging others who are newer to the market to read simple books like "Motivated Money" in order to build their confidence and conviction. Then when a crash occurs their likelihood of making major mistakes is significantly reduced. And important hopefully they'll have the confidence to do just the opposite by maximising these magnificent buying opportunities despite their potential fear.

    This is what you don't want to do:

    https://cuffelinks.com.au/wp-content/uploads/AO-cycles.png

    Investing against the herd: resisting emotion - Cuffelinks

    Cheers
     
    Last edited: 10th Jan, 2017
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  9. orangestreet

    orangestreet Well-Known Member

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    WHF NTA update as of 31 December 2016 = $4.84 (prior month $4.64). Note that this is pre-tax.

    This meant a discount of 11.16% as at 31 December 2016.

    More info here: Latest Net Asset Backing

    I am very happy to have bought WHF between August and November last year when the prices were a real bargain. Also very happy to hold and continue buying as and when opportunity presents itself.

    Not advice.
     
    Last edited: 11th Jan, 2017
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  10. austing

    austing Well-Known Member

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    From the Thornhill thread but thought I would also post it here as it's relevant:

    @Il Falco says:
    I think the following example might be an instance of this albeit I wouldn't have known at the time. I was too busy buying to look:).

    Take AFI which is generally the most expensive of the LICs. And here's me with ears pinned back buying where the arrows are. I went too hard too early during the initial GFC crash (NTA also at a premium) but cashed up again I caught most of the subsequent bear market buying opportunities. Other LICs less popular and smaller with greater discounts to NTA (huge in some instances) offered substatially better buying opportunities. I went even more crazy buying a number of them. These are the times us Contrarian investors dream of.

    Match the timeline of the green arrows (where I went on a LIC buying spree ) on AFI's price chart with It's NTA discount for the same date range:

    AFI's Price Chart:
    IMG_0040.JPG

    AFI's NTA Chart:
    IMG_0039.JPG

    Believe me when these situations arise you won't need any indicators to know these are incredible buying opportunities. Indicators and tools as discussed previously may however reduce the probability of exhausting one's cash / LOCs too soon. Watching great opportunities from the sidelines because you've run out of funds to invest is a bit depressing:(.

    And of course this is an extreme example and not what @Il Falco was specifically meaning. One needs a guide for the rest of the time as well.

    Given the heat wave coming through I expect to be inside again entertaining myself playing around with these things. Thanks all for your ideas.

    A deep bear market AND LICs at a discount to NTA, doesn't get any better than that. Please, please Mr Market can we do this again:).
     
    Last edited: 12th Jan, 2017
  11. wombat777

    wombat777 Well-Known Member Premium Member

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    I'm somewhat impressed by the track-record of SOL after receiving an investor update in the mail recently.

    This is one of my first holdings so is only smallish. I'm considering divesting some of my lacklustre stocks to move funds into SOL and simplify my portfolio.

    returns-banner2-1140x390.png
     
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  12. austing

    austing Well-Known Member

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    Speaking of SOL:
     
  13. BingoMaster

    BingoMaster Well-Known Member

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    Just be aware it's not a LIC like the others. It's much more concentrated in it's holdings. TPG for example is over half of it's holdings, I believe.
     
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  14. austing

    austing Well-Known Member

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    Our favourite way of owning SOL (and our largest holding) is through the other Millner vehicle MLT. Portfolio including SOL exposure is found here:

    20 Largest Investments | MILTON CORPORATION LIMITED

    Much less concentration risk than holding SOL directly as highlighted by @BingoMaster.
     
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  15. wombat777

    wombat777 Well-Known Member Premium Member

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    Thanks for the info. I already separately have holdings of the big 4 and Telstra so don't think MLT would be a good fit for my current portfolio.
     
  16. austing

    austing Well-Known Member

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    Last edited: 14th Jan, 2017
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  17. BingoMaster

    BingoMaster Well-Known Member

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    Those two are excellent introductory links. The second one in particular mentions some great building blocks of a portfolio for LICs, in my opinion. I didn't read as much of the first one, cos seemed harder to read, but seems to answer some good newbie questions.

    Should be made a sticky, perhaps?
     
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  18. austing

    austing Well-Known Member

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    Trouble is it's fine until the owners of the site change link names or reconfigure the site etc.

    I'll post the second article in two parts (> 1,000 characters) so it doesn't get lost.

    Maybe one day a beginner's sticky can be created for this thread.
     
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  19. Mac Fields

    Mac Fields Well-Known Member

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    @Simon Hampel Can a sticky be made (in the interim at least) that people can contribute to, to hold some of this valuable info (information references, books etc as opposed to great info in threads themselves)?
     
  20. Redwing

    Redwing Well-Known Member

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    And ongoing/growing dividends help lessen the pain

    The hard part is trying to ignore the media and your gut instincts

    upload_2017-1-14_18-51-20.png
     
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