Bill Shorten’s proposed “franking credit grab” is still impacting the listed investment company (LIC) market. This was one of the drivers behind a “premium crunch” earlier this year when many LICSs moved from trading at a premium to NTA (net tangible asset value) to trading at a discount. Almost four months after election night, discounts for LICs are the norm.
This includes Australia’s biggest LICs - Australian Foundation (AFIC), Argo Investments (ARG) and Milton Corporation (MLT). Managing a combined $16 billion in assets, these LICs invest broadly across the market in well-diversified portfolios and offer investors an “all in one” way to establish and maintain core Australian equity exposure.
That same exposure can also be secured by investing in index tracking exchange traded funds (ETFs).