# BKI - BKI Investment Company



## System (10 September 2010)

BKI Investment Company Limited (BKI), formerly Brickworks Investment Company Limited, is an Australian investment company. The company invests in a diversified portfolio of Australian shares, trusts and interest bearing securities.

http://www.bkilimited.com.au


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## jono64a (3 September 2013)

System said:


> BKI Investment Company Limited (BKI), formerly Brickworks Investment Company Limited, is an Australian investment company. The company invests in a diversified portfolio of Australian shares, trusts and interest bearing securities.
> 
> http://www.bkilimited.com.au




Seems to have great performance and low fees of  0.18%, comparable to the sound older and bigger LICs Argo and AFIC, and unlike most of the newer LICS that charge 1% and usually performance fees too.


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## Judd (21 October 2013)

Drat and damn I suppose.  Applied for my full entitlement under the 1 for 15 and held my hand out for more under the top up facility.

Applications scaled back by 5.9% as the offer was over-subscribed.  Applications under the top-up considered disproportionate to the applicants entitlement were rejected in full.  $48.1M raised and together with the placement a total of $107M.  Estimated to take the market capitilisation to about $850M.  MER is 0.18% (internally managed.)  Yield around 6.7% grossed up.


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## Pager (22 October 2013)

Judd said:


> Drat and damn I suppose.  Applied for my full entitlement under the 1 for 15 and held my hand out for more under the top up facility.
> 
> Applications scaled back by 5.9% as the offer was over-subscribed.  Applications under the top-up considered disproportionate to the applicants entitlement were rejected in full.  $48.1M raised and together with the placement a total of $107M.  Estimated to take the market capitilisation to about $850M.  MER is 0.18% (internally managed.)  Yield around 6.7% grossed up.




Yeah me too, hold these in my SMSF  but wait and see, maybe small shareholders will pick up the majority of the top up altough i applied for 5 times my 1-15 placement so im not overly optomistic


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## Judd (24 October 2013)

A small scale back.  Shame a direct debit of refunds cannot be made in cases where the share registry has the relevant bank details for depositing dividends as opposed to issuing a cheque.


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## Pager (25 October 2013)

Seems applying for 5 times my allocation was ok, as I received all bar the 5% reduction so happy with that, IMO they may well have accepted all allocations from small investors but maybe a few of the big boys put in massive requests for any shortfall to grab a quick profit, good on BKI for knocking them back in full.

A good little listed investment fund this one, although not quite so little these days maybe the best in the sector, CAM is the other I hold in my SMSF.


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## Judd (5 July 2014)

BKI has announced a Share Purchase Plan, the applications for which, close towards the end of this month.  The maximum price per share is $1.655.  The June 2014 pre-tax NTA was $1.63 and the post-tax NTA being $1.51.  Yield presently 4.2% ff.  No performance fee payable and MER is 0.17% (which is based on fixed costs such as directors fees and not Funds Under Management as applies to some other LICs.) 

In two minds about submitting an application.  My gut feeling, ie pure guesswork, is the market is getting a little ahead of itself.  The yields on most other LICs are being forced down toward 3.5% as  money appears to be chasing chasing yield.  It makes me a little cautious.

Last financial year, my investing activity consisted of taking up SPPs and Entitlement Offers with a view of keeping ahead of my costs through an increased dividend stream.

Just need to think about it over a brew of coffee with some Bach in the background.  That or shred the living **** out of the Fender Strat.  Either approach should work.


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## Craton (27 July 2019)

Even at a premium, with interest rates at an all time low for the foreseeable future and its Australian equities mandate this LIC is benefiting. Current grossed up yield 8% https://bkilimited.com.au/investment/wp-content/uploads/2019/07/NTA-June-2019.pdf


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## Dona Ferentes (23 January 2020)

Another LIC with an identifiable tilt happening







> Listed investment fund BKI has markedly trimmed its exposure to the major banks as a slip in bank dividends weighed on its bottom line in the first half. Handing down its results on Wednesday, the income-focused investor said significant dividend cuts from Westpac and National Australia Bank had trimmed its investment revenue growth, which ticked up just 0.8 per cent for the half to $27m. Higher dividends from Magellan, BHP, Woolworths and Macquarie Group helped to make up only some of the dip.





> In the past three years, BKI has *reduced its exposure to the banks from 33 per cent to 15 per cent,* helped by a selldown in NAB, Westpac and ANZ most recently. Portfolio manager Tom Millner told The Australian while financials were a key component of the broader market, weak operating trends and governance issues in the sector meant there were better-yielding opportunities elsewhere. But he didn’t rule out all of the heavyweights – adding to the fund’s holding of Commonwealth Bank to keep a market weight over the period, while BKI’s investment in Macquarie Group is now three times the market weight.





> “We believe Macquarie Group is a highly misunderstood business, with 60 per cent of earnings annuity in nature and a mortgage book that is growing double digit; the fastest rate of growth in the sector,” Mr Millner said. “For the 2020 financial year, on a grossed-up basis, we estimate Commonwealth Bank’s dividend yield to be 7.5 per cent and Macquarie Group’s at 5.1 per cent.”
> 
> He said investing in an ultra-low rate environment posed a risk for income investors, but that positive trends in population growth, infrastructure spend and superannuation growth would continue to provide tailwinds for stocks within the fund’s portfolio.
> 
> Net profit including special investment revenue for the half was reported at $25.5m, a near halving of the previous period which was bolstered by special dividends shelled out amid a fear of franking cuts and after the demerger of Coles and Wesfarmers. BKI’s biggest special investment revenue received during the period was from Brambles, Coles and Telstra.





> Lower term deposit rates also ate into its income – with returns from bank deposits down 67.5 per cent over the period to just $0.4m, from $1.2m last year.  Mr Millner said the fund was holding roughly 7 per cent in cash at the end of the half, and was poised to deploy some in the upcoming earnings season


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## Dona Ferentes (17 July 2020)

BKI Investment Company's full year net profit fell 34.9 per cent on lower dividend income, with the fund manager warning the economy could get worse over coming months. ANZ, Westpac, National Australia Bank, Sydney Airport, Woodside Petroleum, AGL Energy and Seek were among the companies that either cut or did not pay a dividend.


> "We believe that every Australian company has been impacted by the COVID-19 economic crisis, and as we've already seen, it has had a negative impact on earnings, balance sheet strength and dividend distributions on many companies within our market," says co-portfolio manager Tom Millner. "Unfortunately, the way we are viewing the broader economy suggests that the current situation may deteriorate over the next 6-12 months."



The $1 billion listed investment company net profit decreased to $48.6 million from $74.7 million as total income fell 34.4 per cent to $53.9 million. The company enjoyed a special dividend from its investment in TPG, which generated $3 million in revenue.

BKI Investment Company declared a final dividend of 2.32¢ and a special dividend of 1¢ a share. Payment will be on August 27.

During the year, the company exited position in Boral and Ampol. It also lowered its exposure to banks, with the sector's weighting in the portfolio falling to 15 per cent from 33 per cent three years ago. BHP, Macquarie, Sydney Airport and Woodside were among the stocks added to the portfolio.


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## IrishDigger (17 July 2020)

Thanks Dona, it's interesting to watch what the experts are up to and especially their take on the banks.

I hold BKI


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## Dona Ferentes (23 June 2021)

Now SOL has made a move on the much larger Milton MLT, I wonder if another LIC with a fair smattering of Millners involved will be a possible candidate, down the tracks?

$1.101 bill market cap, with $1.168B in assets and $45mill in cash, _*IE trading  a bit under NTA .*_

Top 25:
1 Commonwealth Bank ... 9.0% 
2. BHP Group .................... 8.3% 
3. Macquarie Group ...........  8.2% 
4. Transurban Group ........ 6.3% 
5. APA Group  .................... 5.9% 
6. National Australia Bank .. 5.6% 
7. Wesfarmers Limited ....... 5.2% 
8. Woolworths Limited ....... 4.9% 
9. ARB Corporation ............. 3.3% 
10. Sonic Healthcare .......... 2.8% 
11. Ramsay HealthCare  ..... 2.7% 
12. ASX Limited ................ 2.5% 
13. Telstra Corporation .... 2.5% 
14. TPG Telecom Limited ... 2.5% 
15. Harvey Norman Holdings ...  2.2% 
16. Amcor .............................2.1% 
17. Woodside Petroleum .... 2.1% 
18. Fortescue Metals Group Ltd .... 1.7% 
19. Rio Tinto Limited ................ 1.6% 
20. New Hope Corporation ...... 1.6% 
21. Coles Group ......................... 1.5% 
22. Magellan Financial Group  ... 1.5% 
23. Goodman Group Limited .... 1.5% 
24. Invocare Limited .................. 1.4% 
25. Suncorp Group  ................... 0.9% 

Cash and cash equivalents .........   3.7% 
Total of top 25 plus   Cash and cash equivalents .... 91.5%


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## Belli (23 June 2021)

Dona Ferentes said:


> Now SOL has made a move on the much larger Milton MLT, I wonder if another LIC with a fair smattering of Millners involved will be a possible candidate, down the tracks?
> 
> $1.101 bill market cap, with $1.168B in assets and $45mill in cash, _*IE trading  a bit under NTA .*_
> 
> ...




No need.  Contact Asset Management is already receiving about 0.06% of the FUM in fees.  With the $3.2b being brought into SOL and the 0.1% already in place for managing its investment portfolio, I reckon they have got a good night's sleep covered.









						About Us - Contact Asset Management
					

In 2016 Contact Asset Management was established as an innovative investment manager, implementing a set of principles honed over many generations.




					contactam.com.au


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## divs4ever (21 July 2021)

lifted from the middle of today's results

BKI Performance Overview

BKI Investment Company Limited (“BKI”) today announced its 2021 Full Year results. Australia's performance in controlling the COVID-19 epidemic and economic stimulus packages was of significant benefit to the Australian household and consumer during the last year. The Government’s substantial economic support packages and the banks’ loan deferrals were very well received and placed the economy in a strong position. We were concerned in February, when BKI presented first half results, that the forecast growth in unemployment and the completion of payment deferral programs would create a headwind for the Australian economy. Fortunately, these issues were not as severe as we first thought and did not materially impact the local economy. The severe fluctuations in global share markets we experienced in FY2020 and early in FY2021 dissipated with the backdrop of a stronger global economy. However, many Australian equity investors continued to receive lower dividends than they received 12 -18 months ago. These cuts impacted BKI’s results in FY2021, with Ordinary Investment Revenue down 17% to $39.7 million. The result was impacted by lower ordinary dividends received over the last year from New Hope Corporation (down 73% on the previous corresponding period (pcp)), Invocare Limited (down 70% on the pcp), Woodside Petroleum (down 62% on the pcp), Commonwealth Bank (down 42% on the pcp), AGL Energy (down 26% on the pcp) and Transurban Group (down 22% on the pcp). BKI realised $0.3 million from the trading portfolio, after participating in some minor trading positions. BKI’s interest received was only $0.1 million, down 82% on FY2020 due to the extremely low interest rates on offer. BKI’s Net Operating Profit After Tax, before special investment revenue, was $35.7 million, a decrease of 14% over the previous corresponding period. BKI’s basic earnings per share before special investment revenue decreased 15% to 4.83 cents per share

 DYOR

 i hold BKI

 lucky for me i took ( some ) advantage of last year's carnage  , but i have to agree div. income wasn't very impressive ( for me either ) what DID help  was some holdings suspending the DRP ( CMW in particular ) and paying cash instead 

 but nice to see they admit last year was tough for the buy and hold strategy


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## Dona Ferentes (21 July 2021)

divs4ever said:


> BKI Investment Company Limited  today announced its 2021 Full Year results...........






divs4ever said:


> i hold BKI ....   lucky for me i took ( some ) advantage of last year's carnage  , but i have to agree div. income wasn't very impressive ( for me either ) what DID help  was some holdings suspending the DRP ( CMW in particular ) and paying cash instead
> 
> but nice to see they admit last year was tough for the buy and hold strategy




Now SOL has moved on Milton, it may be that, when the dust from that transaction settles,  a *similar move on BKI is made; * with a Market Cap if $1.2B and similar approach :


> LONG TERM, INCOME FOCUSED
> Hold companies that can grow their dividend over the long term





> COMPETITIVELY LOW COST
> 0.10% management fee and no performance fee.





> ACTIVELY MANAGED
> Invest in well managed, quality Australian companies.



and also trading a bit below NTA (@ $1.63 compared to $1.73).

Not a given, but quite possible?


....................---------------------..............................
The spelling out of the BKI investment Process, from p12 on, as per today's Investor Presentation, is quite thorough and illuminating..


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## divs4ever (21 July 2021)

i already hold SOL  , but what MIGHT happen is MLT and BKI management combine formally  i believe there are some links already 

 was looking at beefing up the BKI holding sub $1.50 

 but i love LICs because they do trade below the NTA ( well some of them do )

 remember i am after div. income  , so yield is more important than capital gain to me ( with the rare exception )

 i will happily add to a discounted LIC if it is paying 6% div. yield  (on what i paid for it )

 cheers


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## Dona Ferentes (21 July 2021)

divs4ever said:


> i already hold SOL  , but what MIGHT happen is MLT and BKI management combine formally  i believe there are some links already




What has ALREADY happened is that SOL has made an offer to acquire Milton, to be decided in Sept when shareholders vote. This saw MLT shares lift from a 5% sub NTA trading price around $5 to more than $6, as investors bought the story of enhanced dividend, if only one-off, and being part of a larger ASX diversified investment house. 

Look at the board of BKI and MLT, and the names in SOL and you will see links. Look at the holdings and you will see overlap of assets.

(_also, <some> LICs as investment vehicles are carrying a tarnished reputation, and most are unable to attract fresh capital. the market has voted by chasing ETFs. Only the frenetic marketing by a Geoff Wilson is creating growth in the sector_)


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## Dona Ferentes (21 July 2021)

just for the record

BKI has a MER as at 30 June 2021 of 0.17% - taken from the Annual results out today.

The cut and paste a few frames above, taken from BKI’s website, had 0.10% . I'd believe the former.


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## divs4ever (21 July 2021)

CURRENTLY i prefer LICs over ETFs ( if the market crashes  that MIGHT reverse in my buying activities )

 now i don't HATE Geoff Wilson  ( i hold WAX and have done very nicely on that since i bought into it in Sept. 2011 ) but i buy a variety of LICs  , because they have a style ( or strategy ) that i am not skilled at ( 90% of the time )

 i have a theory if i can do something well , why hire a contractor  , now if i am less skilled at something  THEN i will look at the other options 

 so when i buy a LIC i am mostly hiring a person who does stuff i am not good at 

 Mr Wilson is trying to super-size LICs  and that scale introduces it's own problems  and potential efficiencies  , 

 nice for Mr. Wilson , but not what i am chasing  , i am after a diversified income that DOESN'T dry up completely  during global panics , depressions and whatever ( while i am alive )

 so far i have resisted  Mr. Wilson acquiring LICs i hold  , because if i loved his LIC i would have bought WAM in 2011 ( and i didn't , WAX scratched my itch beautifully )


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## mullokintyre (5 October 2021)

To my untrained bleary bloodshot charting eye, BKI looks to have fallen below the support level of 1.60 that has been tested three times already this Fin year.
For similar reasons to Div4, I am keen to get into it, but I need a positive buying signal.
1.57 was the high from the early part of the year, so would be looking to t least buy under that, then the next support level is 1.47.
Mick


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## divs4ever (5 October 2021)

yes $1.47 would have me reaching for the calculator


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## Belli (5 October 2021)

From what I recall the management of BKI present themselves in a similar light and attitude towards investing as other older LICs.

It does not appear they have been very successful at it.  It'd be a total avoid if I had funds to invest outside of my present holdings.


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## divs4ever (5 October 2021)

sometimes boring and conventional thinking is good 

 BKI is not a big part of my portfolio   ,  but in a risky market sometimes a steady hand  is a nice insurance 

much depends on WHY BKI falls , if it is in tandem with the market  , well that is fine by me  , i will probably add more  ,
 if BKI was falling because of bad investment choices  , that is a very different problem  ( very easy to be lured into  a dud IPO , plenty of big managers have done that )

 to me div. yield ( at my buying prices ) is important to me  , i can always 'average down'  my price in a falling  market  as long as management isn't starting to unravel 

besides i hold other LICs  better at small-caps/mid-caps  and shorter holding times ( WIC and WAX  as examples) sure the yields are higher  but they take extra  risks and are always more likely to stand on a bear-trap


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## Belli (5 October 2021)

That is about as brilliant a strategy as averaging down into AGL.


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## So_Cynical (5 October 2021)

Belli said:


> From what I recall the management of BKI present themselves in a similar light and attitude towards investing as other older LICs.
> 
> It does not appear they have been very successful at it.




Was looking at BKI and other LIC's and ETF's the other day, BKI is/was a 
standout underperformer. shareholders voting with their feet - leaving.


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## mullokintyre (5 October 2021)

Belli said:


> That is about as brilliant a strategy as averaging down into AGL.
> 
> View attachment 131077



Beli I think you may have missed the point of what Div was saying.
Everybody has different  investment  rationals, some reasonable, some not so.
But the one thing you can say, is what is a good investment strategy for person A, is not so much for person B.
In my SMSF, the members are at various stages of their working/retirement life, and thus have different risk levels, tax levels, time frame levels and investment ethic levels.
Income streams are of vital importance to those who are in pension phase and have no other income.
They are of little consequence to someone working at getting  their income from their work.
I invest in some higher risk/higher reward  trading options for those very early on in accumulation phase., and safer income producing streams for the more elderly members.
BKI would fit that bill if i can get it a low enough price, and would keep averaging  down provided I was confident enough it would still keep producing the income stream, as that is what is the most important.
Mick


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## Craton (5 October 2021)

Have held BKI since the IPO. One thing to note is managements investment model.


> BKI is focused on investing in quality companies for the long-term that have a history of and are expected to continue to pay attractive and growing dividends.



I'm thinking that with many of BKI holdings recently paying a reduced or nil divvy, impacts to the negative.


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## Craton (5 October 2021)

Further, was/am looking at the longer term and BKI gets me access to companies I don't want to directly hold, TLS e.g.


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## So_Cynical (5 October 2021)

Craton said:


> Further, was/am looking at the longer term and BKI gets me access to companies I don't want to directly hold, TLS e.g.




Yeah but many LIC's and ETF's will give an investor access to the top 20,  the AFI SP has smashed BKI as 
has pretty much every other large broad based LIC and ETF, AFI prob has a higher div yield as well?
~


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## Ferret (5 October 2021)

I inherited some BKI a few years back and sold out about 18 months ago.  

I looked carefully at it and the results just didn't stack up against the bigger LICs like AFI, which I have as a core holding.

The senior Milner seems to be quite astute. SOL has performed much better than the son's BKI.


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## Belli (5 October 2021)

So_Cynical said:


> Yeah but many LIC's and ETF's will give an investor access to the top 20, the AFI SP has smashed BKI as
> has pretty much every other large broad based LIC and ETF, AFI prob has a higher div yield as well?





For sure it is each to their own but if going for an LIC, there may be better ones than BKI.  17 September report.









						LIC reports and updates
					

The following reports and updates on Listed Investment Companies (LICs) and Listed Managed Investments (LMIs) are provided by Bell Potter, Independent Investment Research, and Morningstar.




					www.firstlinks.com.au


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## So_Cynical (5 October 2021)

Ferret said:


> I inherited some BKI a few years back and sold out about 18 months ago.
> 
> I looked carefully at it and the results just didn't stack up against the bigger LICs like AFI, which I have as a core holding.
> 
> The senior Milner seems to be quite astute. SOL has performed much better than the son's BKI.




Just looking at their august monthly report, BKI has 18000 shareholders, and have 2.6% of the fund in Telstra.



			https://bkilimited.com.au/investment/wp-content/uploads/2021/09/NTA-Aug2021.pdf


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## divs4ever (5 October 2021)

but 


So_Cynical said:


> Yeah but many LIC's and ETF's will give an investor access to the top 20,  the AFI SP has smashed BKI as
> has pretty much every other large broad based LIC and ETF, AFI prob has a higher div yield as well?
> ~
> View attachment 131079



 so far , i haven't been desperate  to access the Top 20  ,  i snapped up BKI at a fair valuation and a reasonable mandate   , but in the next big  dip AFI , or maybe ARG , or AUI  could be better value than BKI

 the beauty of LICs ( to me ) they give interesting variations to the basic theme of tracking ( out-performing ) the index  but the opportunity to buy at a discount to the NTA .

 ETFs  have their place , but they only try to track an index hoping inflation will do the heavy lifting ( and to me that is fine if buying insurance  )


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## divs4ever (5 October 2021)

thanks for the report update 

 where i differ  from many  , is i do not put all my effort into one LIC , ETF or  stock ( i don't expect one investment to be a winner all the time , most will have both good times and bad )

  you can probably class WES , SOL and GOW   as investment companies  ( i hold all three )

 LICs i currently hold  are BKI , CAM , CDM , D2O , EAI , IBC , PIA , PL8 , QVE , WAX , WIC , WLS


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## Belli (5 October 2021)

divs4ever said:


> ETFs have their place , but they only try to track an index hoping inflation will do the heavy lifting ( and to me that is fine if buying insurance )




That would have to be the most inane statements I have read in many a year.

If what you claim is true then the only reason the S&P/ASX 300 Index can increase (which is what a product such as VAS tracks) is due to inflation only.  Your understanding of index funds is clearly zero.

 As for the LICs you hold you are paying a motza in fees for the underperformance net of dividends of the majority of them.  GOW, by the way, is technically classified as an LIC.  There are certain criteria which apply for companies to be able to be listed as such and GOW meets those.

Your thoughts are naught but an empty shell.  I'll save myself any future effort by ignoring the drivel you post.


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## divs4ever (5 October 2021)

i understand VAS well enough to understand  it rents out customers shares to short-sellers   AND uses my voting power in those shares to enforce an ESG ( and carbon neutral )agenda  whether i align with those views or not 

 and therefore my holdings in Vanguard and Blackrock ETFs are up for sale ( at a price ) and will be replaced  by comparable ETFs when the opportunity presents ( probably during a market meltdown  )

 and by the way you always had the option to ignore me or debate me 

 cheers


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## divs4ever (5 October 2021)

but lets  compare the XKO  ( Top 300 ) from the low  in 2011 ( somewhere close to)   4003 points  and the current closing price of  7246 points  a 81% rise  over roughly ten years 

 PLEASE NOTE   the constituents of the XKO in 2011  differ quite a bit from the constituents  today ( October 2021 )

 my VAS av. of $57.48  ( my cheapest parcel was $52.70 bought December 2011 ) and the current  closing price of  $92.77   a 76% rise over my lowest price   but since i didn't buy at the 2011 bottom  that 81% above  is probably closer to the VAS performance 

 anyone want a stab at guessing the REAL inflation  ( per annum ) over the last ten years   how close to 8% per annum  was it  ( compared to 'official inflation ' ) i am guessing real inflation  has averaged over 5% per annum  which would imply  VAS  has only managed a 3%  per annum capital gain over real inflation  despite the constituent changes ( and capital gains/losses )

 now VAS as an insurance against me picking  badly  it has done it's job nicely   sadly  management has made  some decisions i dislike but i can't blame the computer algorithm  for that  ( it is a typical key person risk in a managed fund )


Per Share Statistics​
TYPE2011201220142015201620172018201920202021TREND*Distributions (c)*241.10254.10299.10296.30292.40294.10337.20356.50267.100.00



*Franking (%)*69.0076.0071.0082.0071.0075.0066.0081.0072.00--




 

 DYOR


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## Belli (5 October 2021)

In the event some new investor reads this understand, contrary to the view of one uninformed and crazy poster, with index funds *there is no key person risk*.  Plain vanilla ETFs are *not *actively managed funds.

Appreciate that indexing  is a form of passive fund management. Instead of a fund portfolio manager actively stock picking  and market timing the fund manager* builds a portfolio whose holdings mirror the securities of a particular index*. There is no human involvement in the price of the ETF.

Authorised participants involved in the creation of an ETF is an organisation that has the right to create and redeem shares of an ETF. They provide a large portion of the liqudity  in the ETF market by obtaining the underlying assets required to create the shares of an ETF. When there is a shortage of ETF shares in the market, authorized participants create more. Conversely, authorized participants will reduce ETF shares in circulation when the price of the ETF is lower than the price of the underlying shares. That can be done with the creation and redemption mechanism *that keeps the price of an ETF aligned with its underlying net asset value.*


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## divs4ever (5 October 2021)

i would suggest the  unfortunate demise  of Jack Bogle  was exactly that 

Jack Bogle Investment Advice – His Top 10 Philosophies​








						Jack Bogle Investment Advice - 10 Rules He Always Follows
					

Want to learn how to invest like Vanguard founder, Jack Bogle? Check out the 10 pieces of Jack Bogle investment advice he swears by.




					wealthpursuits.com
				




 after his demise 
 Vanguard started ( openly ) lending shares  , and  decided  to  to pressure  some companies to  change their business model ( leveraging the 5% plus holdings in large cap. companies )

now i am not going to tell you  i followed  his every rule ( i didn't ) but i could respect his approach well enough to buy VAS and VHY in 2011  when there were plenty of cheap stocks to buy competing for the same cash 

 cheers


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## divs4ever (5 October 2021)

with a LIC you are buying into a management team and ( normally ) a fairly strict mandate and strategy 


 but  an ETF should  be all about 'the magic algorithm ' and index chosen to track


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## Belli (6 October 2021)

Your lack of understanding is astounding.

If you believe an ETF such as VAS or STW only increase due to inflationary effects then BKI is not a good deal as the management team, ie Contact Asset Management, has not done very well at all.  So much for you views inflation is the driver for an ETF.  BKI seems to have done an extremely good job avoiding any such effect.







Anyways I don't care where you place your funds, whether you make heaps or go bankrupt.  What is annoying and potentially dangerous to newer investors who come across your posts is you giving the impression you know what is what when you obviously don't.

By the way, Jack Bogle wasn't involved with ETFs as you incorrectly imply.  That fact alone demonstrates your lack of knowledge.


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## Belli (6 October 2021)

Vanguards approach to security lending.



			https://intl.assets.vgdynamic.info/intl/australia/documents/research/via-securities-lending-whitepaper-2018.pdf
		


And its PDF



			https://www.vanguard.com.au/adviser/products/documents/10927/AU


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## Greynomad99 (6 October 2021)

Hmm - some robust views here fellows. As a chartist I don't worry myself with the in's and out's of many of the issues raised here, but for what it is worth I had a quick look at BKI.
Price has been rising in a price channel where it seems to have bounced off the top boundary and is likely headed for the lower boundary - probably around $1.55
Historically, BKI has been losing value since 2015 and while there have been 3 medium term buying opportunities over that period, it suggests to me that as a LIC they aren't much chop as a long term hold. However, if they do fall back to around $1.55 and bounce, there is perhaps an opportunity for a profitable short term trade. Getting above that dashed blue overhead long-term resistance line would be a big ask however.


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## Belli (6 October 2021)

Greynomad99 said:


> Hmm - some robust views here fellows




He he. More a matter of strongly objecting to someone, when presented with facts, distorting those to fit their own reality and then presenting it as if it is reality.  To name but two:

Equating a passive index fund to an actively managed fund = false
Raising "key person risk" for index funds when there isn't a "key person" involved = false

I'm out of here anyway.  Just hope no one applies the suggestions of the dude.


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## divs4ever (6 October 2021)

BKI certainly don't have the pizzazz of several other rivals  , but MLT will soon be taken over  releasing some more potential  buyers onto the market  , and let's face it  trying to gouge out dividend returns  can be hard work for the aggressive-style managers  ,  and probably a matter of luck  for the long term hold style managers  ( who can pick which companies will have a take-over approach next )

 luckily some fund managers believe in div. smoothing  , and have some cash held back for the rough moments  , but how  can those div. reserves last   some have enough for a year or two   i have seen one claim of 3 years  worth .

 and capital gains look nice , but  unless you sell  surely they don't mean much  , or am i the outlier who doesn't borrow against the share holding ( Commsec  will lend 65% against BKI ) ??

 one thing i do worry about  is we might  soon  have  a scarcity of good solid companies listed outside the top 100  , and that might make a fund manager's job tough as well


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## Dona Ferentes (19 January 2022)

Half yearly out

_During the first half of FY2022, we added to existing positions, all of which offered significant grossed up dividend yields. Main investments were made in Aurizon Holdings, Rio Tinto, BHP Group, Fortescue Metals, Harvey Norman, APA Group, Pendal Limited, Suncorp Group and Metcash Limited. BKI accepted the Washington H. Soul Pattinson (SOL) Proposal to merge with Milton Corporation, which was implemented on the 5 October. BKI now holds 391,908 shares in SOL, accounting for 0.9% of the portfolio. 

Endeavour Group was traded out of the portfolio after receipt as a demerger dividend from Woolworths. BKI also traded the Transurban Rights received as part of the entitlement offer following the successful bid for the Westconnex Assets.    BKI exited and reduced the weighting in some positions over the half. The exposure to ASX Limited was reduced after the company announced a fall in profits, a cut in dividends and a poor delivery of their capital expenditure program. BKI reduced positions in Commonwealth Bank, Woolworths Limited and Metcash Limited following their off-market buybacks. BKI exited positions in Brambles, Platinum Asset Management and Magellan Financial, with these sales prompted by a reduction in our confidence for these companies to increase dividends over the short to medium term._


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## divs4ever (19 January 2022)

thanks i missed this  .. slept in late , and the laptop needed updating 

 i am surprised they exited EDV  , but not surprised they reduced WOW

 cheers


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## InsvestoBoy (22 July 2022)

Belli said:


> BKI is not a good deal as the management team, ie Contact Asset Management, has not done very well at all.




I think they paid it out as dividends @Belli ...they've done alright.


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