Based on some of the comments I want to explore something:If you...

Based on some of the comments I want to explore something:

If you invest in growth stocks they really pay little or no dividends. Thus in order to pay fully franked dividends, you have to trade those unrealised gains.

By forcing a degree of trading in order to have franking credits you in fact enforce churn.

We all know that the best gain is the unrealised gain as that means the ATO is lending us free money ( being their share of the profits) - I have a few stocks that I really cannot afford to sell e.g CCP bought at $9.00 and now $33. CGT on $24 is just too much to give away.

Say the portfolio has 40% growth stocks and we assume that they pay nothing in dividends then the 60% only generates say 3.75% or 2.25c of fully franked dividends. I think that the 4c dividend is hurting the stock. It's in fact forcing the churn.

I am also sure that the intention was that the CGT would provide the rest of the dividend but logically it is now ( my opinion ) forcing the investment team to take the profits to earn the franking credits.

I am thinking of approaching MG and suggesting that the dividends be dropped down to roughly what the portfolio generates in normal dividends. So that would be between 2.5c and say 3c and that even when the portfolio gets above IPO of $1.00 that they stick to this so that they have more cash and start building franking credits. To my mind, the current share price is too dismal to contemplate and I cannot see how they grow the fund if they are paying out 4c. If the market hates it and the share price drops I would suggest that they wait until the share buyback is full up and in April put another in place and buy at 82c and anyone wanting to sell has a floor price.

If I go to MG I am sure he will be concerned that the share will tank and in the short term the overhang is killing it for all of us. That is why I want to explore this idea here.

Let's face reality, I don't see him winding it up so you are not going to get NTA. So 3 on 82c is in fact 3.65% before franking and I can live with that,