There is a significant tax advantage in returns from LICs . Active ETFs must distribute their capital gains which are a pain in the butt at income tax time. I recall once receiving an $8K capital gains distribution which I had to enter on my tax return from a fund whose unit price had not risen much over the year. Whereas LICs only distribute fully franked dividends. This is an important consideration that is ignored when comparing returns with that of active ETFs. As for fees, some LICs such as AFI, ARG, MLT , AUI etc charge MER of only 0.15% or less which is much the same as index ETFs and lower than that charged by thematic ETFs ( typically around 0.3 - 0.4%) and a lot lower than active ETFs which can be over 1% plus performance fee. There is a place for both LICs and ETFs ( both index and active) in portfolios.
SOL Price at posting:
$30.48 Sentiment: None Disclosure: Not Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)