WAR's returns since inception have been pretty disappointing for shareholders. I shed light on them, and reveal why future returns are destined to be underwhelming too.
<< Summary: In June 2021, Wilson Asset Management raised $225m for its 8th LIC: WAM Strategic Value (WAR). Its strategy being to capitalise on discounts to net asset value, primarily in LICs and LITs. If the ASX Closed End Fund (CEF) sector has plenty of worthwhile investments, and if there is an efficient way to close discounts, then why not invest alongside the LIC king Geoff Wilson?
Especially as Wilson Asset Management funds (e.g. WAM, WLE) have been behind most of the takeovers and activism in the ASX CEF sector. And, unlike retail investors, their funds can get to 5% holdings to call shareholder meetings to consider exits near NTA (takeovers or conversions). Thus, even if not buying WAR directly, investors in ASX CEFs may be very interested in WAR's chosen investments - these would obviously be the best short to medium-term opportunities in the entire ASX CEF sector according to Wilson Asset Management.
Well the above is the theory. In this post, I share the disenchanting reality about CEF discount capture strategies and WAR's actual ability to exploit them. I reveal the facts about WAR's NTA and Total Shareholder Return performance since inception. And I take a deep dive into WAR's current portfolio and provide analysis and commentary on the LICs and LITs it holds and their prospects. >>
WAR Price at posting:
$1.01 Sentiment: Sell Disclosure: Not Held
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