LIC & LIT What's Happening with these LICs?

Discussion in 'Shares & Funds' started by flygo, 21st Feb, 2017.

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  1. flygo

    flygo Member

    Joined:
    18th Jun, 2015
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    Location:
    Sydney
    I own VAS, AFI, ARG and MLT.

    I have to wonder why these LICs have been performing so poorly during the past year.

    1 year performance comparison:

    AFI: +4.82%
    ARG: +4.25%
    MLT: +3.81%

    compare to....

    ASX200: +16.89% !!!

    But looking at 10-year performance, they are very close or slightly better than ASX market index.

    Question is why are they undervalued in the past year by so much??
     

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    flygo, 21st Feb, 2017
    #1
  2. orangestreet

    orangestreet Well-Known Member

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    Resource stocks went gangbusters and the LICs you have mentioned are underweight in resources.
     
    orangestreet, 21st Feb, 2017
    #2
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  3. Nodrog

    Nodrog Well-Known Member

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    The older LICs tend to be more focused on Industrial shares for the long term. The following chart shows why:
    IMG_0064.PNG

    Resources are having a strong run more recently but over the long term they are rubbish.
     
    Nodrog, 21st Feb, 2017
    #3
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  4. Phase2

    Phase2 Well-Known Member

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    I work in mining. I'd argue that resources stocks are always rubbish. People just forget, and get really excited.. thus price goes nuts for a few months. It took me 10 years to work that out.. I mustn't be as smart as I thought.. :oops:
     
    Phase2, 21st Feb, 2017
    #4
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  5. Perthguy

    Perthguy Well-Known Member

    Joined:
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    Location:
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    No, but yeah, but no...
    Three unheard-of ASX stocks
    perched to do the unimaginable…
    Potential hyper-growth gains
    from 1,852% to 14,200%
    But leave this until after a critical announcement
    around 20 March 2017, and you can
    kiss this fortune goodbye…

    GIGASTOCKS!!!!

    I can't lose!!!! ;)
     
    Perthguy, 21st Feb, 2017
    #5
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  6. wobbycarly

    wobbycarly Well-Known Member

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    Geelong
    As a part-owner of ARG, I'm interested in the answer ;)
     
    wobbycarly, 22nd Feb, 2017
    #6
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  7. Hodor

    Hodor Well-Known Member

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    NTA premium had a lot to do with it (along with mining), eg. AFI was at around 10% premium at the start of 2016 and it is now about fair value.
     
    Hodor, 26th Feb, 2017
    #7
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  8. Zenith Chaos

    Zenith Chaos Well-Known Member

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    Market sentiment. If you are worried, it is better to keep an eye on NTA performance.

    Share price is only important to me when buying - I calculate yield, compare it to NTA and look at the historical price, but once purchase, the price is irrelevant, unless I'm purchasing more....o_O
     
    Zenith Chaos, 26th Feb, 2017
    #8
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