I have weathered a few storms within this share and at times I get frustrated as the share price fails to reflect the underlying NTA. It makes my portfolio look bad as I am overweight here. I receive a 4c dividend each year fully franked and they seem to be generating good returns when LIC's have generally underperformed the market.
So, on the IPO price ( which you can still buy the shares at ) that's over a 5% return including franking.
That to me passes my hurdle rate and in fact, the underlying assets seem to be growing nicely. After adjusting for dividends it should be around $1.17 before tax and after tax around $1.09. The discount to me is too high but that is for the market to determine and as such it never gets it right as there are not that many shares so any buying volume pushes it up and selling volume pushes it down. As this is at the small end of town it gets more shares dribbled into the market and only when it has news does it get attention.
So how can you value it? Is it just like the other LIC's that tend to have performance that gradually underperforms the market because of fees etc or do you just look to what it gives you each year.
GC1 Price at posting:
99.5¢ Sentiment: None Disclosure: Held
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