The performance of this LIC has been terrible. This is not news to anyone.
As a previous investor from the time it was floated it has been an abysmal failure.
The market has been red hot and all indexes have seen considerable gains. Yet, this fund has gone backwards. Another big reason to push investors towards low cost index funds.
What makes me more angry (at myself) is my failure to look at the exorbitant fees this fund has.
Firstly, the management fee is a whopping 1.5%.
More outrageous is the performance fee of 20% with the hurdle being the official cash rate.
Yes, this fund uses the cash rate, which is currently 1.5%, as its performance hurdle.
To put that in perspective, if the fund takes your hard earned money and puts it in a savings account at your local CBA, they will be eligible for a performance fee of 20%.
If this makes you mad, then sell. The fact under performing companies try to justify these range of fees should make every investor think twice.
The performance fee, based on the cash rate, just exemplifies corporate greed.
Perhaps its time Paul Clitheroe rethink his association...
Posted for every investor looking at this LIC.
MA1 Price at posting:
86.5¢ Sentiment: Sell Disclosure: Not Held
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