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Argo Investments

Fund Manager: Argo Investments
Inception Date: Jan 01, 1947

LIC Argo Flush With Cash

Share Cafe - Aug 15, 2017

Argo Investments seems to be rolling in cash. It lifted its final dividend for the year to June after revealing its fifth consecutive year of higher annual dividends with total payout for the year 31 cents, up from 30.5 cents a year earlier. That was a nine year high, and while it will run its dividend reinvestment program this year, it will close off its share purchase plan for the time being - a sure sign of an investment company with more than enough cash for the time being. That share purchase plan raised $60 million in 2016 and 2017, while the DRP brought in just under $40 million each year. [More]

Australian Foundation Investment Company holds $1.9 billion worth of shares in the big four banks and managing director Ross Barker says the practical outcome of what he describes as a "strange" message the federal government is sending to investors, is that bank dividends will be cut further. AFIC and fellow listed investment companies Argo Investments and Milton Corporation have a heavy exposure to banks and are wincing more than most after the federal budget, as uncertainty swirls about whether the banks will now make shareholders bear the brunt of its new $6.2 billion bank levy. "I think it's a pretty poor outcome," Mr Barker said on Wednesday about the federal government's bank levy. "What the government has done is introduce a tax that just targets five companies. Not an entire sector, just five companies. That's appalling," he said. [More]

We almost fell of our chairs on Monday when we saw Listed Investment Company (LIC) Australian Leaders Fund (ALF) fall almost 10% in a single day of trade. ALF is an Absolute Return manager (meaning they can buy stocks as well as short or sell stocks), whose price generally sees much lower fluctuation than the broader market due to its long/short nature. ALF manages around $360m of funds and has fairly decent liquidity, so we knew something was up to see such a large fall in a day and dug a littl ... [More]

Whilst ETFs are a reasonably new phenomenon, Listed Investment Companies (LICs) have a much longer history, with 30 LICs available on the ASX when the first ETF was launched in 2001. However, they go back much further than that. The oldest and largest LIC on the ASX (AFIC) began life way back in 1936. There’s 6 LICs listed on the ASX which began life over 40 years ago, making them older than many readers of ETF Watch. Today we take a look at the grandfathers of LICs and see how t ... [More]

When two listed investment companies, the $5.3 billion Argo Investments and the $415 million WAM Leaders, released their latest financial results it provided a stark reminder of why the integrated advice model of the major banks cannot survive. Argo and WAM Leaders stand for the sorts of things banks struggle to offer through their integrated advice models – transparency, accountability, low costs and hands-on control of investments. Under the integrated financial advice model there are layers of different fees including adviser fees, platform fees and investment management fees adding up to 2.5 per cent to 3.5 per cent. [More]

As an alternative dividend source to the banks and property trusts, the burgeoning listed investment company sector should be on the shopping list of any self-respecting, self-funded retiree. An LIC is a basket of stocks chosen by a manager and then listed as an investment vehicle on the sharemarket. Critics of LICs contend that investors are merely incurring a management fee to invest in the usual blue-chip suspects: for example, despite recently broadening its investments into selected mid-caps, the banks still account for 25 per cent of the portfolio of the biggest LIC in the local market, the Australian Foundation Investment Company. [More]

Mild Colonial boy Chris Cuffe to join Argo board

The Australian - Aug 26, 2016

UniSuper chairman Chris Cuffe, the “father” of Colonial First State who left the fund manager in 2003 with a $33 million payout, will join the board of listed investment company Argo. Mr Cuffe, the founder of Australian Philanthropic Services, replaces long-serving Argo director Rob Patterson, whose term expires in October. Argo Investments, Australia’s second-largest listed investment company, earlier this month revealed a 5 per cent slide in profit for the year to $216.3m. Revenue for the $5 billion fund slid 5.7 per cent over the period. [More]

It’s official, the Australian Share Market has gone nowhere in the last 10 years. Referred to by some as Australia’s Lost Decade, the ASX 200 index closed at 5,310 on May 1 2006, and almost the same level of 5,252 on April 29 2016. What’s been missed in this comparison however is the impact of dividends on returns. Performance of shares including Exchange Traded Funds (ETFs) and Listed Investment Companies (LICs) is generally reported on their share price movements over time ... [More]

Financial advisers putting clients into simple, low-cost investments since the Future of Financial Advice(FoFA) reforms are helping drive a strong increase in demand for listed investment companies (LICs), according to leading LIC managers. Australia’s largest listed investment company, Australian Foundation Investment Company (AFIC), says both self-managed super funds (SMSFs) and advisers were boosting its shareholder numbers. “Our shareholder numbers are still going up quite significantly,” says AFIC’s general manager of investor relations and business development, Geoff Driver. “We’re still seeing SMSFs come on the register and we suspect there’s still strong demand being driven by advisers.” [More]

Investors with eyes only for the ASX will have few reasons to get excited as they look down the barrel of 2016. The best trade in town for local investors – the big four banks – won't be replicating the returns they've managed in recent years, even though they'll continue to be a reasonable place to find reliable income. Meanwhile, picking the bottom of the commodity cycle will be a tricky game for the domestically focused hopeful in 2016, as China's demand for bulk commodities continues to wain and geopolitical events continue to dictate the value of energy companies. All in, miners and the banks make up more than half the value of the entire ASX 200. [More]

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