I think AFI, ARG and AUI can form the backbone of any...

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WangChung

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28/09/23

12:53

Post #: 70073969
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Originally posted by optimistus ↑

After looking at them all earlier this year I started buying AUI simply because they seemed to have similar characteristics to AFI and ARG (but lower liquidity), comparable holdings and costs but were trading at a much better NTA discount at the time. I also think they've maintained a progressive dividend to date.

I initially laughed at CIN as an option because of their large holding in EVT (around a third of the fund's holdings) but with EVT's dividends now recovering I expect the CIN yield to improve. They have a very large discount to NTA.

Some of these have notable omissions in their holdings but as I typically have a good chunk of those stocks as individual holdings anyway I'm finding AUI and CIN a good proxy for the market adjusted for my individual holdings. I generally prefer some LICs to ETFs where they keep a portion of earnings for growth.

Absolutely not for everyone but given the NTA discounts they're worth a look for some.

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I think AFI, ARG and AUI can form the backbone of any conservative portfolio.

Each has its own strengths and weaknesses.

AFI - liquidity, and writing options can help or hinder overall performance.

ARG - liquidity and greater diversity of holdings - 89 stocks held.(which again can be a two edged sword). A smaller focus on BHP, CSL and CBA than the other two.

AUI - super cheap costs, significant discount to pre-tax NTA, but reasonably concentrated (37 stocks) blue chip portfolio. They also borrow, so have a small amount of debt. Not liquid. Question regarding AUI is can they ever close that persistent discount to NTA (short of the Potter foundation leaving the register, I have my doubts)

Probably worth having a few of each.

AFI Price at posting: $6.81 Sentiment: Buy Disclosure: Held
2 Upvote

1 Great analysis

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