# ARG - Argo Investments



## TjamesX (15 September 2004)

This is my first ever post on any forum board!!! ever!! so get excited

History....

I arrived here as a result of lurking around Propertyinvesting.com and somersoft and so recognise quite a few names around here, but as I am not interested in property (at the moment) I have decided to start investing in shares. I have just started purchasing in the past month and currently have;

2000 AMC (@ $7.28)
4800 ARG (@ $4.88)
300 NAB (@ $26.40)
517 BHP (given by a great grandmother - had since I was a born)

Also I bought and sold ION for a $300 loss. I am planning to hold all of these for the long term.

My question regarding ARG (Argo Investmnets - Listed Investment Company) is this; Currently ARG as trading around 4.85 - 4.89. On Aug31 they reported that net tangible asset backing was 4.91 (excluding capital gains liabilities). So they are trading a little below NTA. However their largest shareholding Maquarie Bank (MBL) has risen around 13% since Aug31 as well as a number of other large shareholdings and ARG has not moved ?????????? I don't care in the short term because I wish to hold these for a long period, I am just curious

TJ


----------



## Jett_Star (15 September 2004)

*Re: Arg ???*

Me too.

http://www.asx.com.au/asxcharting/CisServGif?RequestType=ByName&UseSession=False&GifResponse=image&fresh=false&extgif=true&caller=sharenet&volval=VOL&periods=D6&spread=LAST&siafsec1=S&sec1=ARG&divn1=0&siafsec2=I&sec2=XJO&divn2=0&siafsec3=I&sec3=MA&divn3=0&extcsv=false&reducefact=80&fromdate=15/03/2004&todate=15/09/2004


----------



## TjamesX (15 September 2004)

*Re: Arg ???*

Correction on earlier post.

After looking at the ASX chart of MBL again - it has only moved about 5-6% since Aug31 (my mistake   )

Does anyone know any website that provides free charts better than the ASX website?? I can't chage the timeframe - although I have found a tricky way;

www.asx.com.au/asx/research/chartsSearchResult.jsp?asxCode=MBL&TimeFrame=*D6*&compare=index&indices=XJO

By changing the *D6* in the chart window address to D3 or D1 you can get 3month or 1month charts   

However, I am still curious as to why ARG hasn't moved   

TJ


----------



## GreatPig (16 September 2004)

*Re: Arg ???*

TJ,

Here's a longer term weekly chart for ARG.

If you want, you can download the free FCharts software and free EOD price data from float.com.au and view your own charts.

Cheers,
GP


----------



## GreatPig (16 September 2004)

*NAB Weekly*

And here are the others:

NAB


----------



## GreatPig (16 September 2004)

*AMC Weekly*

AMC weekly


----------



## GreatPig (16 September 2004)

*BHP Weekly*

BHP weekly


----------



## ghotib (16 September 2004)

*Re: Arg ???*



			
				TjamesX said:
			
		

> This is my first ever post on any forum board!!! ever!! so get excited



Wooohooooooo!!!!!  Is that excited enough  ;-)


> History....
> 
> I arrived here as a result of lurking around Propertyinvesting.com and somersoft and so recognise quite a few names around here, but as I am not interested in property (at the moment) I have decided to start investing in shares. I have just started purchasing in the past month and currently have;
> 
> ...



Why did you sell a stock after less than a month when you bought it for the long term? 


> My question regarding ARG (Argo Investmnets - Listed Investment Company) is this; Currently ARG as trading around 4.85 - 4.89. On Aug31 they reported that net tangible asset backing was 4.91 (excluding capital gains liabilities). So they are trading a little below NTA. However their largest shareholding Maquarie Bank (MBL) has risen around 13% since Aug31 as well as a number of other large shareholdings and ARG has not moved ?????????? I don't care in the short term because I wish to hold these for a long period, I am just curious
> TJ



 Short answer: nobody knows. LiCs have gone out of style? The market is busy chasing MBL too high? The market is riding the MUL whirlwind? The rise in MBL is outweighed by the rest of the portfolio? 

Speaking as an investor in another LiC with a similar investment philosophy, I suggest you go back and read Argo's "Owner's Manual" again, then ask yourself what you mean by "long term". From some perspectives, there's no  difference between investing in businesses and investing in properties. 

Ghoti (halfway through reading "The Intelligent Investor" and increasingly aware of how much I don't know)


----------



## TjamesX (17 September 2004)

*Re: Arg ???*

First of all - Great Pig, thanks on the charting software and data, I've checked it out and am pretty happy with what I see.   

Ghoti



			
				ghotib said:
			
		

> Wooohooooooo!!!!! Is that excited enough)




Yes, maybe could have had a couple more o's   



			
				ghotib said:
			
		

> Why did you sell a stock after less than a month when you bought it for the long term?




The short story is, I am doing a course at the Securities Institute and one of the lecturers blurted out that he thought ION was oversold. So I looked at the company and did a little research (not Much!) and decided to by for the med term. Then two things happened i n the space of a couple of weeks;

(1) they got rid of the CEO guy Salthouse, who basically built the company buy himself by buying a couple undervalued companies.

(2) a director sold half a million $ worth of shares below market price

These didn't sit entirely well with me (being inexperienced) so I decided not to wait and see what happens and took a loss.



			
				ghotib said:
			
		

> Speaking as an investor in another LiC with a similar investment philosophy, I suggest you go back and read Argo's "Owner's Manual" again, then ask yourself what you mean by "long term". From some perspectives, there's no difference between investing in businesses and investing in properties.




Funny you mentioned that, I did read it a couple of nights ago. Can't remember what it said exactly - but I will now twiddle my thumbs and wait for them to outperform the index over the next few years.

I did buy Argo because they have a long track record of doing that (outperforming). And my mum told me a story about when she knew the guys who set it up years ago (Patterson was one, she didn't know them that well), but anyway she said he used to write on the backs of scrap paper rather than wasting new ones - its that kind of penny pinching attitude I like


----------



## TjamesX (17 September 2004)

*Re: Arg ???*

Oooh  I forgot to mention that as an Adelaidean, I got them because the're a good old Adelaide company that doesn't need to relocate to bloody Sydney just to keep on the pulse in financial markets!

Go Adelaide Go

Oh and bTW for tonight - GO THE POWER, st kilda will  go down

Who said buying shares shouldn't be emotional??


----------



## still_in_school (17 September 2004)

*Re: Arg ???*



			
				TjamesX said:
			
		

> This is my first ever post on any forum board!!! ever!! so get excited
> 
> History....
> 
> ...




Hi TjamesX,

some of the stock you have mentioned, i had been holding for the upside, 

687 AMC (@ $7.28) exact same price coincidently
NAB - when its been dipping or and technical indicators are showing signs of a blowoff or downtrend have, been successfully buying puts and selling them off very quickly
BHP - sold this morning at 13.50, though the market had opened quickly to my surprise and was unfortunate to move the trailing profit target up in time, though i currently holding BHP15 Oct Calls, lets just hope it can break this $13.60 barrier...

the most stock, im excited about is AMC... could see it go to $9.00 over the medium term, though i see this stock as low risk, but medium to long term views...

Cheers,
sis


----------



## ghotib (18 September 2004)

*Re: Arg ???*



			
				TjamesX said:
			
		

> Yes, maybe could have had a couple more o's



OK:  oooooooooooooooooooooo 



> The short story is, I am doing a course at the Securities Institute and one of the lecturers blurted out that he thought ION was oversold. So I looked at the company and did a little research (not Much!) and decided to by for the med term. Then two things happened in the space of a couple of weeks;
> 
> (1) they got rid of the CEO guy Salthouse, who basically built the company buy himself by buying a couple undervalued companies.
> 
> ...



I'm inexperienced too, so maybe we can learn a bit from each other. For starters, I'm impressed that you were willing to sell when you saw changes to the stock. I think I would have dithered for a while. 

I came here from PropertyInvesting too, via the link in SiS's sig (thanks SiS). I looked hard at property for most of last year, and got a lot of practice at assessing yield and risk and keeping my money in the bank. The really good part of that was that it helped me work out an overall investment framework that I'm now trying to build on. 

I'm not finding many shares at the moment that fit my framework. I think Argo follows a strategy similar to the one I'm trying to work with, which is based on the thinking of this Benjamin Graham guy I'm reading at the moment and also of Warren Buffet. I don't know enough to talk about this very clearly, but one thing I'm trying really hard to get into my head is that I only buy into any investment vehicle if I have excellent reason to believe I will earn more with it than with cash or bonds. It's going to take me a while to really understand what "excellent reason" means, but it's a lot more than rising share price and /or optimistic forecasts from management and analysts. 



> Funny you mentioned that, I did read it a couple of nights ago. Can't remember what it said exactly - but I will now twiddle my thumbs and wait for them to outperform the index over the next few years.
> 
> I did buy Argo because they have a long track record of doing that (outperforming). And my mum told me a story about when she knew the guys who set it up years ago (Patterson was one, she didn't know them that well), but anyway she said he used to write on the backs of scrap paper rather than wasting new ones - its that kind of penny pinching attitude I like



Fair enough. Just don't expect them to outperform the index (which index?) every day or every year. You can probably learn a lot from their shareholders' reports as well as from what they do with the portfolio.

Cheers

Ghoti


----------



## GreatPig (13 September 2005)

*Re: ARG?*

ARG is offering a few shares to existing holders at $5.79 a share.

Given that the price has only been above this for less than two months, and it's well above the longer term trend line, I'm not so sure it's such a good deal.

I do want to get some more ARG at some point, but I think the chance is reasonable of getting them cheaper than this.

Just my opinion  

Cheers,
GP


----------



## TjamesX (14 September 2005)

*Re: ARG?*

I have sold all remaining my ARG shares at 6.00 after they went ex div and my 12 months were up, obviously they will tend to track the over all market, which IMO will be due for a reasonable correction within 12-18 months. They are also trading pretty close to their NTA....


----------



## transit (10 February 2007)

Does anyone think these kind of stocks (LIC's) are back in flavour? 

Although i don't know much about reading charts i can see that ARG and AFI have had a good run the last couple of months.

How does one find the NTA of a LIC? Does the ASX website or Comsec have this info?

Do people think that LIC's should be held in an investment portfolio for the long term (buy & forget)?

Are these stocks mostly used for growth or income?


----------



## reece55 (10 February 2007)

Transit
There is one reason why the LIC sector is booming - because the whole market is moving upward. The NTA of all LIC's are announced on a monthly basis, about 10 - 15 days after month end. So, if you are using comsec, just go to announcements and review whats listed there.

At the present stage, ARG trades at a premium to both its exclusive and inclusive of deferred tax NTA. For instance, their January NTA was excluding unrealised tax was 7.74, which is a fair way off the the 8.88 trade on Friday. ARG has always had a larger NTA premium than say that of AFI however, because it has been long proven that ARG have a history of bigger returns. To be honest, I always wanted to get myself some ARG shares, but the NTA premium always convinced me not to. However, the gap is even wider now.

Cheers


----------



## transit (10 February 2007)

Thanks Reece, i just found the document you talked about under 'announcements' in comsec. It also seems that LIC's are not really good for income given that the current yield is only 2.6%. But i guess you can sell down shares to provide an income if that was the goal.

I'm looking at putting some money into some managed funds with some Aussie stock exposure but these LIC's look more attractive with the lower management fees. I guess the trick with these is to try and buy some when the NTA premium isn't so big.

cheers




			
				reece55 said:
			
		

> Transit
> There is one reason why the LIC sector is booming - because the whole market is moving upward. The NTA of all LIC's are announced on a monthly basis, about 10 - 15 days after month end. So, if you are using comsec, just go to announcements and review whats listed there.
> 
> At the present stage, ARG trades at a premium to both its exclusive and inclusive of deferred tax NTA. For instance, their January NTA was excluding unrealised tax was 7.74, which is a fair way off the the 8.88 trade on Friday. ARG has always had a larger NTA premium than say that of AFI however, because it has been long proven that ARG have a history of bigger returns. To be honest, I always wanted to get myself some ARG shares, but the NTA premium always convinced me not to. However, the gap is even wider now.
> ...


----------



## drmb (10 February 2007)

reece55 said:
			
		

> Transit
> There is one reason why the LIC sector is booming - because the whole market is moving upward. The NTA of all LIC's are announced on a monthly basis, about 10 - 15 days after month end. So, if you are using comsec, just go to announcements and review whats listed there.
> 
> At the present stage, ARG trades at a premium to both its exclusive and inclusive of deferred tax NTA. For instance, their January NTA was excluding unrealised tax was 7.74, which is a fair way off the the 8.88 trade on Friday. ARG has always had a larger NTA premium than say that of AFI however, because it has been long proven that ARG have a history of bigger returns. To be honest, I always wanted to get myself some ARG shares, but the NTA premium always convinced me not to. However, the gap is even wider now. Cheers



I hold ARG, AFI and DUI in my smsf as a set and forget. I have problems with DUI because it is so illiquid, there is hardly any volume traded and some days zip. So even though I buy at a premium to NTA when I sell DUI (as I did because I was way overweight with them after a rights issue) I either have to wait days for a sale or take a 10-15% hit on nta. Other respected lics  to check are AUI, MLT, CHO, BKI . 

If you do decide to put some of your portfolio in LIC spreading them around gives more distinct opportunities to participate in SPP's, Rights etc. These LIC's have quality portfolios and low management expense ratios 0.1 - 0.3%, run by people with respect from an operational business backrounds rathre than just financial backgrounds such as stockbrokers, etc. 

If you want to do more research go to www.asx.com.au and use the "search", eg for "LIC ARG". One of the recent links was to http://www.asx.com.au/investor/pdf/lic_nta_report.pdf which will give an analysis of the LIC situation including sp to nta. One other lic that I liked but never got was ALR. It was trading above its nta but now has gone a little flat. It's attraction is a better div than my others. I would also caution against just using sp to nta, look at ELI Emerging Leaders Investments NTA to SP -22.92%, FAT Fat Prophets Australia NTA to SP -23.95% and HIC Huntley Investment -16.33% for example, it is a hefty discount and you would think it is an undiscovered gem, but when it came to sell you would also be selling at a discount to nta. 
LICS provide me with an opportunity to pack away about 30-40% of my smsf without worrying to much about investment strategies, set and forget, and allows me to have a bit of fun with stocks such as pdn, bmn, smm, inl, imd, etc, and they are always there in case I kick the castle over with my speccies


----------



## transit (10 February 2007)

Thanks drmb, can you please tell me what SPP stands for? Is this some type of share issue particular to LIC's? 

Someone recently mentioned Whitefield (WHF) as another quality LIC to keep an eye on. Looks like they are heavily into the banks.  They last closed at $4.68 but have a NTA of $5.20 as of Jan 31st 2007 (10% discount):

http://imagesignal.comsec.com.au/asxdata/20070208/pdf/00691699.pdf 




			
				drmb said:
			
		

> .....
> 
> If you do decide to put some of your portfolio in LIC spreading them around gives more distinct opportunities to participate in SPP's, Rights etc. These LIC's have quality portfolios and low management expense ratios 0.1 - 0.3%, run by people with respect from an operational business backrounds rathre than just financial backgrounds such as stockbrokers, etc.
> 
> If you want to do more research go to www.asx.com.au and use the "search", eg for "LIC ARG". One of the recent links was to http://www.asx.com.au/investor/pdf/lic_nta_report.pdf which will give an analysis of the LIC situation including sp to nta.


----------



## tybutler (10 February 2007)

LIC's are usually very conservative and most will tell you that they are medium or long term holds. I think they're great to include in any portfolio. 

Personally, I like to read the annual reports of these types of companies as an educational tool (portfolio make-up, recent purchases etc.). A good example is Clime Capital (CAM), whose director, Roger Montgomery, makes a point of keeping investors updated and educated about their methodologies. 

They do tend to track the ASX200 though, so I wouldn't expect outstanding gains. Over time you should do well however.

Worth looking in to.

Ty.

Hold AFI, CAM, WAM (all LIC's)


----------



## Judd (10 February 2007)

transit said:
			
		

> .........can you please tell me what SPP stands for?




SPP = Share purchase Plan.  Within every 12 months (calender?) companies are allowed to offer current shareholders the ability to purchase up to $5,000 worth of shares.  The Co's do not have to issue a prospectus to raise these new funds.

Last year AFI offered 1020 shares @ $4.90.  CHO will be offering an SPP at a price still yet to be determined (normally is the averaged weighted price over the period between the ex-dividend date and the record date.)  If history is anything to go by, it is possible that that MLT, CHO's stablemate, will offer a SPP at the September/October reporting period.

ARG usually offers an SPP of $2,500 every dividend time but this year has a 1 for 8 renounceable rights issue at $7.20 per share to current shareholders.  Shareholders can also apply to take up any shortfall if other shareholders do not take up the rights issue.  Back in early 2004, ARG had a 1 for 10 rights issue at $4.40 per share and had to limit applications for additional shares to 1000 shares for each applicant.  Could happen again.


----------



## drmb (10 February 2007)

transit said:
			
		

> Thanks drmb, can you please tell me what SPP stands for? Is this some type of share issue particular to LIC's? Someone recently mentioned Whitefield (WHF) [/URL]



SPP - Judd answered above. If you decide to put part of your investment into LICs then it is worth considering spreading them around the elite ones because you get a limit of $5000 worth of discounted shares every 12 months. It's like another 2-3% dividend. But the point is you get the option whether you hold 5000 or 500000 shares. So by spreading between say arg, afi, dui, aui, cho, ect., you can maximise the return you get if you take up the spp.

I don't know WHF, but you can do some initial research by comparing its performance against some of the others. I just did a quick comparison and it seem to be in between ARG and DUI, another reason to spread them around if you are a defensive investor. Past performance is no guartee of future performance etc, etc

I suggest you do what I didn't when I started investing, and that is do some research, eg check each site and check the major investments, they usually publish a top 25. If you feel comfortable with the spread then that fund may be OK with you. I just put money into whatever the financial advisor said to, or the stockbrokers tips and ended up with a lot of slow performers, such as PRV, and WIL. These 2 seem to be moving now but I spent months and months watching them stagnate while there was a bull market booming. Could've been ahead! But now I'm sorted out. Also look at the size of the fund, you will find ARG is sitting near the top with total funds under investment. What impressed me right from the start with arg is its annual reporting is very low key brochure, its not 100 pages of glossy paper with lots of earnest people in hard hats looking at shovels. Keeps the costs down!


----------



## transit (16 February 2007)

Thanks for the info Judd and drmb. I just checked the sp for ARG and it's dropped quite a bit recently with todays close at $8.08 which is still a premium to the NTA of $7.74. Does anyone know if this is considered fair value at this price. I would like to get some ARG but not sure how to determine what amount of premium i should be paying to the NTA.


----------



## drmb (16 February 2007)

transit said:
			
		

> Thanks for the info Judd and drmb. I just checked the sp for ARG and it's dropped quite a bit recently with todays close at $8.08 which is still a premium to the NTA of $7.74. Does anyone know if this is considered fair value at this price. I would like to get some ARG but not sure how to determine what amount of premium i should be paying to the NTA.



Value is such a personal thing! ARG to me is a long term investment that if I wanted to buy more I probably would not even look at the NTA premium or discount, since it's an elite LIC with a proven track record. Have a look at the top 20 holdings (as published on the arg website as of today's date) and see if it fits in with your perception of value, whether you think these companies are going to increase in value with time (the figure after is the market value that ARG holds). If you bought them in the same proportion, how much brokerage would you have to pay to get the same spread?  -

Macquarie Bank Ltd. 306.2 
Milton Corporation Ltd. 181.8 
BHP Billiton Ltd. 164.1 
National Australia Bank Ltd. 149 
Australia and New Zealand Banking Group Ltd. 124.1 
Australian United Investment Company Ltd. 118.2 
Telstra Corporation Ltd. 111.5 
Rio Tinto Ltd. 99.5 
Wesfarmers Ltd. 96.7 
Westpac Banking Corporation 92.1 
Commonwealth Bank of Australia 88 
St. George Bank Ltd. 83.6 
Woolworths Ltd. 75.8 
AMP Ltd. 65.2 
Rinker Group Ltd. 59.9 
Westfield Group  50.8 
Foster’s Group Ltd. 50.4 
QBE Insurance Group Ltd. 42.7 
Woodside Petroleum Ltd. 42.3 
Origin Energy Ltd. 42 

You'll notice 2 elite LICs in the top 20, Milton and AUI.  Milton's top holdings

Westpac Banking Corporation 135,466 
National Australia Bank 94,806 
Commonwealth Bank 89,369 
Bank of Queensland Limited 70,802 
Choiseul Investments Limited 70,615 (an elite LIC)
St George Bank Limited 59,635 
Wesfarmers Limited 46,967 
ANZ Banking Group Limited 46,821 
Perpetual Limited 46,057 
Washington H Soul Pattinson 42,207 
Bendigo Bank Limited 41,160 
Suncorp-Metway Limited 39,398 
Woolworths Limited 36,104 
Campbell Brothers 32,139 
BHP Billiton Limited 28,242 
Trust Company of Australia Limited 26,385 
QBE Insurance Group Limited 24,740 
Brickworks Limited 24,615 
Macquarie Bank Limited 22,388 
CFS Retail Property Trust 20,604 

AUI top holdings

1. BHP Billiton Ltd  53,650 	7.7% 
2. Rio Tinto Ltd 46,680 	6.7% 
3. ANZ Banking Group Ltd  46,533 	6.7% 
4. Woodside Petroleum Ltd  37,400 	5.4% 
5. National Australia Bank Ltd  35,160 	5.1% 
6. Diversified United Investment Ltd  31,735 	4.6% (another elite LIC)
7. Westpac Banking Corporation Ltd  31,428 	4.5% 
8. Alumina Ltd  29,362 	4.2% 
9. Tabcorp Holdings Ltd  24,320 	3.5% 
10. Wesfarmers Ltd  21,198 	3.1% 
11. Woolworths Ltd  20,150 	2.9% 
12. Commonwealth Bank Ltd  19,985 	2.9% 
13. Brambles Industries Ltd 19,800 	2.9% 
14. Orica Ltd  17,917 	2.6% 
15. Westfield Group  17,330 	2.5% 
16. AXA Asia Pacific Holdings Ltd  15,675 	2.3% 
17. Suncorp Metway Ltd 15,480 	2.2% 
18. Perpetual Trustees Australia Ltd  14,630 	2.1% 
19. QBE Insurance Group Ltd  14,350 	2.1% 
20. St George Bank Ltd 13,198 	1.9% 
21. Alesco Corporation Ltd 11,933 	1.7% 
22. Southern Cross Broadcasting (Aust) Ltd  10,500 	1.5% 
23. Iluka Resources Ltd  9,825 	1.4% 
24. Australian Gas Light Company Ltd  9,630 	1.4% 
25. Bluescope Steel Ltd 9,540 	1.4% 

There was a 1:8 renouncable rights announced 5 Feb and the reason for the apparent drop in value is due to the shares going ex rights on 12 February -  the entitlement is 16 February but the rights are already trading as ARGR, and were 0.71 at close today. Arg closed at 8.08 today. Add those together and you get 8.79 for a holder on the 11 February.

In conclusion up to you to decide what to buy but ARG forms part of the untouchable base of my SMSF. It's one of those shares that Warren Buffett might well say "hold forever". Don't buy it to trade in a few weeks or months because it's a "keeper" imo.


----------



## Garpal Gumnut (18 February 2007)

transit said:
			
		

> Thanks for the info Judd and drmb. I just checked the sp for ARG and it's dropped quite a bit recently with todays close at $8.08 which is still a premium to the NTA of $7.74. Does anyone know if this is considered fair value at this price. I would like to get some ARG but not sure how to determine what amount of premium i should be paying to the NTA.




Dear transit and drmb,

Thanks for the informative posts.

There was an interesting article in the Weekend AFR about the rights ARGR and ARG.

I was considering buying the rights and then applying for shares for my SMSF, however the shares from the rights miss the div in March and existing shares are now ex div. 

So I may wait and see how broader market goes for a while , or look at other LIC's

Garpal


----------



## transit (18 February 2007)

Drmb, thanks heaps for taking the time to post this and educate me a bit more about LIC's and ARG in particular. 

As you pointed out, it's interesting to note that a lot of LIC's hold other LIC's in their portfolio such as Milton Corp holding Choiseul Investments Limited, and AUI holding Diversified United Investment.

I also noticed that ARG have a large holding in Milton Corp (MLT) as well. I guess this strategy allows LIC's to be even more diversified as well as spread their risk a bit more with their portfolio.


----------



## Judd (18 February 2007)

And MLT and CHO have on board people who have a deep interest in Soul Pattinson, ie the Milners.  And DUI and AUI have the same chairman who has an interest in the ANZ; Charles Goode.  Seems to be wheels within wheels.

Here is a link to matters LIC/property trusts/others on the ASX.

http://www.asx.com.au/investor/lmi/tools/research.htm


----------



## drmb (18 February 2007)

transit said:
			
		

> Drmb, thanks heaps for taking the time to post this and educate me a bit more about LIC's and ARG in particular.



No probs


			
				transit said:
			
		

> As you pointed out, it's interesting to note that a lot of LIC's hold other LIC's in their portfolio such as Milton Corp holding Choiseul Investments Limited, and AUI holding Diversified United Investment. I also noticed that ARG have a large holding in Milton Corp (MLT) as well. I guess this strategy allows LIC's to be even more diversified as well as spread their risk a bit more with their portfolio.



I did used to get worried about the "circular holdings" which if you did a reducto ad absurdum, would mean that each LIC only held other lics in the portfolio with apparently no income! And no growth. And one wonders which is the chicken and which is the egg? Here are some typical LIC cross holdings with "parent" and "child"
ARG hold DUI, AUI, MLT, CHO, BKI 
AUI hold DUI
BKI hold MLT, CHO
CHO hold MLT
DUI hold nil other LICs
MLT hold CHO

I guess it is done as a way of diversifying and spreading risk. If  all LIC's trade at discounts the cross-holdings work in the holder and the LIC's favour since the 'parent LIC' has its NTA calculated by marking the 'child' NTA to market, but this understates the true worth of the 'child' LIC. If LIC's trade at premiums to NTA the cross-holding work against you. However I don't care now! I just hold and watch grow. 

If you are looking at other LICs take into consideration volume since when it comes time to sell you may find your LIC is illiquid. Eg AUI, DUI would seem to be a problem. In these cases the discount to NTA persists when you try to sell and you may be selling at a greater discount if you are impatient and want the sale on the same day or even same week. Check DUI sales for example - the market depth sit on the bid below NTA and there are typically very few, very few sellers and sometimes none. Along you come wanting to sell but find no buyers at the price you want so you wait, and wait since most sales are on the bid. 

This is not a problem with eg ARG and AFI since the sales volumes are considerably more each day. 

Anyway take care and remember your choice of LIC is a longer time horizon than say with other stocks, take a 5 - 10 year approach!!! Also note I am not an expert, I just have DUI, AFI and ARG as about 30% of my smsf.


----------



## Bluebeard (27 April 2007)

Anyone still monitoring ARG or the other LIC's and can give a view? Im also interested in finding out if there are LIC's out there that focus on internationally based shares.


----------



## Ken (27 April 2007)

From what I have read ARG expects a correction, and have been holding off on a number of investments as they see the market over valued in certain areas.

They have been a consistant performer with a dividend re-investment plan that is good for long term investors, and that suits me.

Whether they are overvalued now I don't know.

Its a stock that I will be accumulating when the market has any minor corrections.

If you like the look of the stocks they hold then I guess you'd invest in them.


----------



## Prospector (27 April 2007)

I have been accumulating Argo for many years now.  They just keep on keeping on, no great surges, no great dips. One of those almost Blue chip shares!


----------



## Ferret (28 April 2007)

Bluebeard,

TGG is a LIC that invests in international shares.  Only found out about it recently when AFI put in a notice of being a substantial holder.

I am keen to diversify out of the Australian market and I like LICs (hold a reasonable amount of AFI), so I've now got TGG on my watchlist.  However, before I buy I'll wait until I feel the $A has topped and its effect washed through the share price of a LIC like TGG.

Ferret


----------



## Judd (28 April 2007)

Note that TGG does not hedge its holdings against the $AUS.  Hold TGG as well as (low cost) Vanguard International Indexed (Hedged) and PMC which takes the bets and shorts as well.  Also hold AFI, ARG, DJW and WAM (the last not really being an LIC but is classified as a trading company by the ATO so cannot pass on discounted LIC capital gains)


----------



## Ken (8 July 2007)

Monthly CHart of ARG for the past 10 years

http://www.asx.com.au/asx/research/...ompareCode=&TimeFrame=M10&chart.x=0&chart.y=0

Interesting that it has always outperformed.


----------



## Ken (24 July 2007)

ARG the life time stock.

Purchased 2007 sold never.

This stock is tucked away BHP would not find this one in my drawer.


----------



## Prospector (25 July 2007)

Ken said:


> ARG the life time stock.
> 
> Purchased 2007 sold never.
> 
> This stock is tucked away BHP would not find this one in my drawer.




Purchased in 1989!  Never to be sold. Always accumulating in their wonderful SPP : :


----------



## prawn_86 (25 July 2007)

this is actually the only stock the college i used to live owns. they have held it for about 5 years now and that is how i first heard of it. nice little dividend and excellent capital gains. plus they are adelaide based


----------



## Judd (25 July 2007)

It's generally boring and true to its aim - to increase dividends overtime at a rate greater than inflation.  This lot, combined with the dividends from other LIC's we hold, mean that each year, we do not scramble around for funds to pay: rates; house/contents insurance; car registration and insurance or health insurance.  And there are still funds left over to buy a few more now and then.


----------



## Kravis (28 July 2007)

Hi all,
This has been a great thread to read through.
I dont own arg but do believe the best LIC going around is aui. Very tightly held by only a handful of shareowners and own a quality portfolio of other businesses. Interested to hear other posters who own aui or thoughts on LIC's.


----------



## drmb (28 July 2007)

Kravis said:


> Hi all,
> This has been a great thread to read through. I dont own arg but do believe the best LIC going around is aui. Very tightly held by only a handful of shareowners and own a quality portfolio of other businesses. Interested to hear other posters who own aui or thoughts on LIC's.
> 
> 
> ...


----------



## Kravis (28 July 2007)

Thanks for the post drmb.
I agree with your issue on the liquidity issue, but in my mind when I purchased AUI I had no exit strategy in mind. I still consider to buy, hold and reinvest the earnings and hold a significant chunk. 
AUI has performed well and will continue to do so, as will other quality LIC's such as ARG. 
The downside as you mentioned was the spp and the ability to invest $5k or whatever the max may be. In that case, thats why I also hold CHO. Another quality to have in the stable particularly heavy on banking.


----------



## drmb (28 July 2007)

Kravis said:


> Thanks for the post drmb.
> I agree with your issue on the liquidity issue, but in my mind when I purchased AUI I had no exit strategy in mind. I still consider to buy, hold and reinvest the earnings and hold a significant chunk.
> AUI has performed well and will continue to do so, as will other quality LIC's such as ARG.
> The downside as you mentioned was the spp and the ability to invest $5k or whatever the max may be. In that case, thats why I also hold CHO. Another quality to have in the stable particularly heavy on banking.




CHO and AUI are definitely elite LICS. Agreed, IMO you can't go wrong holding these long. I also figure I have exposure to these through ARG, since AUI and Milton are in top 25, and CHO is held by milton. Cheers


----------



## Judd (16 August 2007)

Given this day of carnage when the ASX 200 was, at one stage, down 300 points to below 5500, a thought struck me.  I hold ARG and I recall that in its latest report, it was sitting on over $420M in *CASH*.

I wonder if it has been in the market over the last few days with its ears pinned back?  If so, I may have even more reason to take up the SPP which is on offer.


----------



## Ferret (16 August 2007)

Its great that ARG is sitting on plenty off cash at the moment.  But at the same time MBL was their biggest single holding by far.  It is sure to have given the asset backing figure a big jolt this month.  

I prefer to sit on the sidelines and wait until the market digests ARG's 31 August asset backing before considering buying.


----------



## Ken (16 August 2007)

I have read that ARG has been loading up on stocks.

They rarely sell stocks.

They are long term investors.

The NTA will be interesting next month.

But I suspect they are buying not selling.

There NTA would have lost a fair bit, but over the long run short term pain for long term gain.

This is what ARG was after a correction.

And this was what that big capital raising was for.

I think 7.70 is a little expensive though I think the NTA might be somewhere around $7.00-7.30 at a guess.

Because they have MBL and heaps of em.


----------



## Ken (16 August 2007)

This stock is not going to trade above its NTA I wouldnt have thought so might as well wait for the next announcement.


----------



## Ken (7 December 2007)

argo investments 10 year returns averaging 14% last 3 years has averaged 19% last 5 years 18 %.

last 12 months just 7.3%

what is this telling us?   Either they are investing in the wrong things?  Which I presume they aren't if you look at there holdings, or it is out of favour.

Uncertainty if the something people fear most in the market, so whilst there is uncertainty over the US, and the ARG are stagnatge, it appears a  great time to accumulate the stock.


----------



## prawn_86 (7 December 2007)

I have actually met Rob Patterson briefly and he is a very intelligent man.

I like Argo as a stock, especially if you are looking for diversified exposure. More of a managed fund than a stock.

Although the market doesnt ever seem to rate it heaps highly so i dont own any. 

Good defensive stock imo.


----------



## intheblack (18 December 2007)

Ken said:


> last 12 months just 7.3%
> 
> what is this telling us?   Either they are investing in the wrong things?  Which I presume they aren't if you look at there holdings, or it is out of favour.




Keep in mind the total dividend of $0.27 paid out in the past year, as well as the 1-for-8 renounceable rights issue in February, and the SPP offered at a discount to market price.  This brings the return for the past year to 10%+.

Most LICs have underperformed the index in recent times due to their underexposure to the resources sector, which is considered more volatile than other sectors and tends to pay smaller dividends.

Interestingly, LICs tend to be steadier than the broader market, because they are largely owned by buy-and-hold investors (often SMSFs).  For example, in today's 3.5% drop in the S&P/ASX200, ARG fell only 0.2%, MLT fell 0.5%, CHO 0.3%, AFI 1.5%, DUI 0.5% etc.


----------



## brettc4 (5 March 2008)

For those ARG shareholders;
ARG is, as usual, allowing existing shareholders to purchase some additional shares up to $2,500.

The price these shares will be provided at is $7.39.
Unfortunately, the current price is at $7.21.

Do you think many people will buy shares, and if they do not get much of an uptake, it is likely that future Share Purchase Plans will either:
a) go back to $5,000
b) be priced at a greater discount. The current discount is 2.5% but they can go to 5%.

Cheers,
Brett


----------



## Prospector (5 March 2008)

For the first time in many years, I wont be taking up the spp.  Arg hasnt really done all that much in comparison with other shares so I have even lightened my portfolio.


----------



## prawn_86 (5 March 2008)

Yes it is also the first time that a business i am involved in will not be taking up their rights issue.

ARG to me has always been pretty much an index tracking fund and not much else really. 

I strongly argued against taking up the SPP and i was glad the other members saw my point of view.


----------



## Muschu (4 May 2008)

May I ask a basic question?  I gather ARG had a capital return [over and above dividends] of, usually, $1/year for the years 2002-6.  Was this a straight payment to share-holders and why did it cease?
I may be misinterpreting this but I did receive a straight capital return, about 2 years ago, for another stock I hold.
Also, please, how does NTA fit into your assessments of ARG?
Comments welcome
Thanks
This is from Etrade:
Dividend History
Type Cents per share Frnk % Ex Dividend Date Dividend Pay Date 
Interim 14.00 100 12/2/2008 4/3/2008 
Final 15.00 100 14/8/2007 5/9/2007 
Interim 12.00 100 12/2/2007 9/3/2007 
Capital Return 1.00 100 17/8/2006 8/9/2006 
Final 13.00 100 17/8/2006 8/9/2006 
Interim 11.00 100 20/2/2006 10/3/2006 
Final 11.00 100 17/8/2005 8/9/2005 
Capital Return 1.00 100 16/8/2005 8/6/2005 
Interim 10.00 100 21/2/2005 11/3/2005 
Capital Return 0.50 100 16/8/2004 8/9/2004 
Final 9.50 100 17/8/2004 8/9/2004 
Interim 8.50 100 23/2/2004 12/3/2004 
Capital Return 1.00 100 18/8/2003 12/9/2003 
Final 8.50 100 18/8/2003 12/9/2003 
Special Cash 0.50 100 18/8/2003 12/9/2003 
Interim 7.50 100 21/2/2003 14/3/2003 
Special Cash 0.50 100 21/2/2003 14/3/2003 
Capital Return 1.00 100 19/8/2002 13/9/2002


----------



## intheblack (23 May 2008)

Muschu said:


> I gather ARG had a capital return [over and above dividends] of, usually, $1/year for the years 2002-6.  Was this a straight payment to share-holders and why did it cease?




Those years had a capital return of 1 cent, not 1 dollar.  Unfortunately I became an ARG shareholders after these capital returns, but I understand they would have been paid with dividends (i.e. as either cash or to be reinvested in the DRP, as per shareholder preference).



Muschu said:


> Also, please, how does NTA fit into your assessments of ARG?




If ARG's share price is below NTA, this means that you can purchase $1 of assets for less than $1, and thus signifies that you are getting good value.  However, the ratio of share price to NTA varies continuously from a discount to a premium, so I wouldn't get too hung up on what the ratio might be at any particular time.  As John Bogle (founder of the Vanguard Group) says, the best time to invest in a quality company (like ARG or a low-cost index fund) is when you have the money to do so.


----------



## brettc4 (27 October 2008)

I went to the Argo Shareholder meeting today here in Adelaide (we don't have a lot so I thought I would go)

This was my first AGM and I thought I would share a few of my observations:

1. We were at the Adelaide Convention Centre and the room they organised was almost packed out, I would guess in excess of 750 people attended.

2. At 32, I was definetely in the young crowd, there was a lot of grey or balding heads in attendance. I actually feel that a lot were there for the free sandwhichs and cake at the end.

3. On the whole, the audience was happy with the directors over the past year, with a record profit, albeit since the end of last finance years, things have continued to go down hill in terms of share price, and the prospect for dividend increases.

4. There were not a lot of questions, but this may be normal.

5. They showed their top 20 holdings as of the 30 Seoptember.  They also said they have $200m+ in cash at the moment which is actually the biggest holding.

Point 5 begs the question, when will they start buying, unfrotunately, there was now answer provided.

Cheers,
Brett


----------



## robert toms (28 October 2008)

What were the nibblies like...they say that the oldies got to AGM's for the refreshments.
Are the quality of the nibblies an indication of the strength of the company?
I am not far from the oldie category myself and wonder whether I would do better with a Vili's pie ?


----------



## brettc4 (28 October 2008)

They looked like gourmet triangle sandwhiches and the only desert I saw was a mini chocolate eclair thing.

My problem was I couldn't get past the hungry masses to even get near a table.  I do think a fairly large portion are there just for the free lunch, or maybe it was afternoon tea for some of them 

If the fare was a little more to my liking I may have stuck around and tried to get closer to a table.

Cheers,
Brett


----------



## Garpal Gumnut (22 August 2009)

This favourite of the blue rinse set on a monthly chart is very interesting.

The recent Feb/Mar 09 lows bounced off a long term up trend and the ecstasy of early 2007 shows the beginning of a downtrend from that high.

Both lines are approaching a meeting.

Perhaps an indication of "consensus value."

It will be interesting to see how this golden oldie performs next year.

I may even buy a few if it touches the lower line in October.

gg


----------



## venger (30 March 2010)

Just thought i point out Argo's recent announcement - new executive team...

good to know that R.Patterson is joining the board after retirement..


----------



## brianwh (31 March 2010)

Can anyone explain why the SP for ARG has fallen by about 6% in the March Qtr while funds that track the S&P 200 such as STW have actually risen a % or 2. I know there is a 12 cent dividend which came out, but the SP has fallen a lot more than 12 cents. As I understand it, not only are you paying Management, but there is also a premium to NTA in the price. I have seen estimates of this premium as high as 15%! - although this figure is not recent.

I hold ARG in my SMSF but am looking for an exit point.


----------



## Ken (16 September 2010)

any thoughts on why its trading below NTA at present.

market has risen since August 31, yet ARG seems to be lagging....

could be some value here...


----------



## Muschu (16 April 2013)

Ken said:


> any thoughts on why its trading below NTA at present.
> 
> market has risen since August 31, yet ARG seems to be lagging....
> 
> could be some value here...




Given the volatility this has been "solid" imo.


----------



## matty77 (5 November 2013)

Any thoughts on this stock lately?

Have had someone p@#$ng in my ear the other night about it.


----------



## Muschu (5 November 2013)

matty77 said:


> Any thoughts on this stock lately?
> 
> Have had someone p@#$ng in my ear the other night about it.




As a retiree I hold this and AFI.  Both pay just under 4% FF dividends.  I think most consider them defensive and "relatively" safe.  Certainly their charts are not as bad as many others.  I wonder when [and if] the market starts to move forward more strongly whether they'll keep pace with many individual stocks.

I'm happy with them for now and have experienced some growth with both.  Nothing astronomical of course but acceptable.  A year ago ARG was about $5.75.  Today it is $7.17.  [with dividends in between]. And yet it went down a tad today in a rising market.

Depends on your risk profile I suspect.


----------



## Judd (6 November 2013)

I stopped buying both AFI and ARG in late 2012.  Just felt that they were getting a little ahead of my buying comfort zone.

Same with the banks but that was in early 2012.

Apart from dabbling in a couple of SPPs and Entitlement offers and topping up WHF earlier this year, I am sitting and building up cash with dividends.  There is no hurry.


----------



## piggybank (27 December 2013)

Highest close today ($7.29) since June 2008. However it did hit an intra-day high of $7.37.


----------



## piggybank (7 January 2014)




----------



## telefomin (6 February 2014)

Hi

I am totally new to ASF and Joe has been very tolerant with errors I made in registering.  I am a conservative investor and retired.
My recent activity has been to focus on companies like Arg and Afi. This might sound boring to younger people.
I have put much smaller portions of my Super into companies such as GEM, NEA and HSN.
I have avoided the resource sector, such as BHP.
My reasoning, perhaps flawed, is that companies like ARG will "cover" me if the big companies like BHP and CBA suddenly take off.
I am over 65 but my question is whether I am being TOO conservative?
Any thoughts will he appreciated.


----------



## Valued (7 February 2014)

telefomin said:


> Hi
> 
> I am totally new to ASF and Joe has been very tolerant with errors I made in registering.  I am a conservative investor and retired.
> My recent activity has been to focus on companies like Arg and Afi. This might sound boring to younger people.
> ...




No one can really give you this information. We would need to know so much more about you and your personal circumstances. If you're really stuck, you could consider seeing an experienced financial planner. Nick Radge may be able to help you, at the somewhat steep cost of $330 an hour though (but perhaps this is normal for experienced and licensed professionals). I don't know of any other licensed financial professionals. I am sure there are others around.


----------



## waimate01 (7 February 2014)

telefomin said:


> Any thoughts will he appreciated.




As Valued says, nobody here can offer advice. However, some general comments can safely be made 

Another term for what you're suggesting is "core and satellite" - a big chunk of your stuff in a solid LIC or a broad-based ETF, supplemented with some specific investment plays. The specific plays might be to tilt your overall portfolio either toward or away from a particular sector, or to increase yield, or just because you enjoy it.

A key thing to consider with "core and satellite" is what sort of split-up you employ. If it's 99% core and 1% satellite, then the extra effort of running the satellites almost certainly isn't worth it (unless you're doing it for recreational purposes). If it's 50:50, then you're possibly not getting enough "ballasting" effect from your core. Personal choice.



telefomin said:


> My reasoning, perhaps flawed, is that companies like ARG will "cover" me if the big companies like BHP and CBA suddenly take off.




With pretty much any managed product, you're going to be hitching your wagon to large swathes of BHP and the banks. When you look at all the dividend dollars paid out annually in the ASX100, 46% of them come from the four banks and BHP. Our market is very much dominated by the big guys.

LICs like ARG and AFI are really interesting. They tend to provide more franking and slightly higher yield than ETFs like STW, and I find the company structure makes the paperwork at the end of the year more straightforward (but I'm a fairly simpleminded soul).

But the really interesting bit is to look at the historical dividend in cents per share (not yield%), and see if you can spot the effect of the GFC - you pretty much can't. ARG, AFI and to a lesser extent, MLT are leviathans with lots of inertia and (thanks to the company structure) the ability to retain earnings. They seem well aware that their shareholders value stability and predictability, and they seem to do a damn good job in smoothing out the bumps in the road, albeit at the expense of potentially missing out on dramatic upside.


----------



## telefomin (7 February 2014)

Many thanks for all of the above comments which I am absorbing... Or trying to anyway.

From experience I would prefer not to go to a high fee charging advisor as I have found that the fees are charged whether the recommended share or portfolio goes up or down. At the same time I am sure many are very ethical and work hard to help others.

My conservative portfolio is doing ok right now but I certainly have much to learn.

Thank you again.


----------



## telefomin (7 February 2014)

Could it be that ARG Is holding up so well as the XD date is nearing, or is it more complex than that?

I suspect a combination of the two....but don't really know.


----------



## GlobeTrekker (8 February 2014)

telefomin said:


> Hi
> 
> I am totally new to ASF and Joe has been very tolerant with errors I made in registering.  I am a conservative investor and retired.
> My recent activity has been to focus on companies like Arg and Afi. This might sound boring to younger people.
> ...




Like others have suggested above, whether you're being too conservative depends on your circumstances.  If your AFI and ARG shares are providing you with sufficient income, and if holding riskier shares will continually stress you out or things are tight and you simply can't afford to lose much of your capital, then stick with being conservative.  Your logic re not holding individual blue chips when you already hold them via LICs sounds fine to me, unless you have a great reason for thinking that a particular stock will perform well and you may want to increase your holding in that particular stock.  These days I mostly just hold LICs as I don't have a lot of time to research individual stocks myself and keep on top of all of them all of the time, so I leave it to the 'experts' at the LICs to do it for me, its much easier and safer to 'set & forget' that way.  I do research the LICs themselves though before buying into them.

Out of the biggest 3 LICs (AFI, ARG and MLT) I like ARG at the moment as they are a bit more diversified (they only hold around 20% of their portfolio in the big 4 banks while AFI and MLT hold over 30% in the big 4 banks).  ARG is trading at a lower premium to NTA than AFI at the moment too.  I also like BKI which is another big reasonably conservative LIC that invests in blue chip shares but have a slightly higher dividend yield.

If you want a bit more risk/return in your portfolio but still want a high amount of diversification with just a few stocks then you can look at other LICs like PMC, MFF or TGG that invest primarily in overseas stocks; or LICs like WAM & WAX that specialise in small/medium size companies.  For a bit more risk you can look at LICs like ALF and DJW (though this one is at a really high premium to NTA right now) who also deal in options to increase returns.

The good thing about owning a few LICs rather than just one or two is that you spread your risk around a bit more, get exposure to even more different types of stocks, and get the opportunity to take part in more rights issues and share purchase plans which allow you to buy more shares at a discount.  Some of the smaller ones also sometimes issue bonus options too.



telefomin said:


> Could it be that ARG Is holding up so well as the XD date is nearing, or is it more complex than that?
> 
> I suspect a combination of the two....but don't really know.




AFI's price has risen a lot compared to NTA over the last few months and is has been trading at a fair premium (recently was around 10%), while  ARG has been trading at a slight discount to NTA until just recently, so maybe its price is a little stickier.  Those looking at AFI may be looking at the premium & thinking ARG might be better value now.  I notice Scott Pape (The Barefoot Investor) has just rated ARG as a strong buy in his free weekly email, so there may be a bit of demand resulting from that too.


----------



## Valued (8 February 2014)

If you are retired, you might like to spend some time reading some books. Don't ask us whether you're too conservative, read and find out for yourself! The best person to give you advice is you. The reason people hire professionals is that they are unwilling or due to time constraints/opportunity cost unable to help themselves. If you have the time, it's best to learn yourself and think for yourself.

There is no greater freedom than knowing that you are right and the majority is wrong.


----------



## telefomin (8 February 2014)

Valued said:


> If you are retired, you might like to spend some time reading some books. Don't ask us whether you're too conservative, read and find out for yourself! The best person to give you advice is you. The reason people hire professionals is that they are unwilling or due to time constraints/opportunity cost unable to help themselves. If you have the time, it's best to learn yourself and think for yourself.
> 
> There is no greater freedom than knowing that you are right and the majority is wrong.




Yes I am reading and learning.... Hence why I joined ASF.  Time is a problem however.   And I have no issues with being with the majority, particularly if the majority is right. I also feel "free".

Scanning through many threads I have developed an impression.  It seems that many, certainly not all, ASF contributors claim to be particularly successful even though their investment strategies may vary greatly. It is not surprising that the paths are quite diverse.

Thank you everyone for your comments which I am taking on board.  At the moment I am at a stage where some informed trading suits.


----------



## waimate01 (9 February 2014)

GlobeTrekker said:


> The good thing about owning a few LICs rather than just one or two is that you spread your risk around a bit more, get exposure to even more different types of stocks, and get the opportunity to take part in more rights issues and share purchase plans which allow you to buy more shares at a discount.  Some of the smaller ones also sometimes issue bonus options too.




Good post. I would add to also consider interval vs external management. In my experience, external management means much higher fees and a manager whose interests are not aligned with your own.

The ASX has quite a nice list at http://www.asx.com.au/products/etf/managed-funds-etp-product-list.htm - click on the "LICs and Trusts" tab.


----------



## Muschu (19 February 2014)

Hi 

Any thoughts on the ARG recently announced SPP?  I'm no expert but it appears a good offer.  Other opinions would be welcome.

Regards

Rick


----------



## GlobeTrekker (19 February 2014)

Muschu said:


> Hi
> 
> Any thoughts on the ARG recently announced SPP?  I'm no expert but it appears a good offer.  Other opinions would be welcome.
> 
> ...




A bit too early to call whether its a good offer just yet.  The closing date for the offer is March 24th.  Only around then will we really be able to tell whether its a good offer or not, depending on where the share price and rough estimate of NTA are at at that point in time.


----------



## Muschu (23 September 2014)

Taking a hit today... Unlike AFI for example.

Wasn't yesterday's announcement good enough for the market?


----------



## Muschu (13 January 2016)

Yesterday was a very poor day for ARG.. 12 month low.  AFI and MLT fared much better.  

Can't just be due to the resources holdings within ARG surely? Similar funds hold them as well.

Any thoughts?


----------



## kid hustlr (13 January 2016)

Muschu said:


> Yesterday was a very poor day for ARG.. 12 month low.  AFI and MLT fared much better.
> 
> Can't just be due to the resources holdings within ARG surely? Similar funds hold them as well.
> 
> Any thoughts?




It's probably a liquidity thing.

ARG is pretty much an index tracker isn't it? that ASX is at 12 months lows...

Unsure of its direct exposure to resources but yes if it slightly more heavily weighted towards the resource sectorn when compared to AFI or MLT it will under perform...


----------



## shouldaindex (13 January 2016)

ARG has become about 15% more expensive since 2011, solely based on premium to NTA

http://www.argoinvestments.com.au/portfolio-performance/premium-discount-to-nta

Looking at that, it's probably due to go the other way.

Rule of thumb there seems to be, best buy when -5% NTA.


----------



## GlobeTrekker (16 January 2016)

Muschu said:


> Yesterday was a very poor day for ARG.. 12 month low.  AFI and MLT fared much better.
> 
> Can't just be due to the resources holdings within ARG surely? Similar funds hold them as well.
> 
> Any thoughts?




ARG has recently been trading at a significantly higher premium to NTA than the other two big LICs (AFI and MLT) and its value was looking out of whack compared to those two and historically (I certainly wouldn't have been touching it at the premium it was at).  The recent drop has brought it back to a more reasonable difference.


----------



## Muschu (11 February 2016)

ARG went XD today with a dividend of 15c and is currently down about 17c - which is roughly what I would expect.

On the other hand MLT also went XD with a dividend of 8.7c but is down 21c.

My impression has been that long term holders prefer ARG but the discrepancy here is interesting.

Any thoughts on this?


----------



## Dona Ferentes (4 February 2020)

Another LIC, (been around for a while, long term value investor, large FUM, low MER) has reported Half Year results. Their broad portfolio generally matched the index. Paying 16c FF dividend. Comments reflect the usual, decline of the banks and other macro issues. Macquarie and CSL are now #1 and #2 holdings.

New purchases include topping up Amcor, CTD, DOW, FFH, RHC, Rural Funds, Tassal. AP Eagers is there as takeover of AHG,  sold all of Incitec Pivot, some MLT , NUF plus Dulux taken over.


----------



## Belli (4 February 2020)

Thank you.

I saw the email from the share registry advising the dividend remained at 16c.  Didn't bother with opening it before deleting or even read the half-yearly report.


----------



## Dona Ferentes (25 March 2020)

Due to the extreme levels of share market volatility currently, Argo Investments Limited (ASX code: ARG) will announce an end of week estimate of its net tangible asset (NTA) backing per share to the Australian Securities Exchange (ASX) for the foreseeable future.

As at the close of business on 20 March 2020, Argo's NTA per share (after all costs, including tax payable) was $6.02.  

_trading around that level today_


----------



## Dona Ferentes (25 March 2020)

as a LIC the sum of its bits was above what it was trading at on COB 23/3. Like most companies, its going to be a timing issue if wanting to buy in


----------



## Dona Ferentes (17 August 2020)

where pessimism meets realism:

ARGO Investments, with assets of $5.3 billion and no debt, announces a full year profit of $199.5 million and a fully franked final dividend of 14.0 cents per share. 

Profit was significantly impacted by COVID-19 effects, with dividends being deferred, cancelled or cut (often substantially) by numerous companies in the investment portfolio, with NAB, ANZ and Westpac having the largest negative impacts on Argo’s dividend income.  

The full year dividends of 30.0 cents per share fully franked are down -9.1% on the previous year. In light of the uncertain economic outlook, Argo’s Board considered it prudent to lower the final dividend to ensure Argo is positioned to weather a potentially protracted downturn with minimal volatility of dividends paid over time.   

The full year dividends represent a fully franked dividend yield of 4.1% based on Argo’s closing share price on 31 July 2020 of $7.39 per share. 

INVESTMENT PORTFOLIO 
In an extraordinary year for the share market, a majority of sectors posted negative returns, with bank stocks among the worst performers. Ongoing industry-specific headwinds and broad exposure to Australia’s rapidly weakening economy weighed on the banking sector. As a result, Argo’s portfolio exposure to the banks has fallen from 17.4% to 13.8% and remains underweight relative to the broader Australian share market.  

During the financial year, Argo purchased $243 million of long-term investments which included adding to new positions. Over the same period, Argo received $127 million from sales and takeovers of long-term investments. The larger movements in the portfolio were:  

*Purchases *
AP Eagers (Automotive Holdings takeover) 
Downer EDI 
Freedom Foods Group 
Oil Search  
Ramsay Health Care
 Suncorp Group 
Treasury Wines *  (new position

*Sales *
AMP 
Ansell 
Automotive Holdings Group (AP Eagers takeover) ** 
Corporate Travel Management ** 
Dulux Group (Nippon Paint takeover) **   
Milton Corporation 
Nufarm ** 
 **  Fully exited position and removed from portfolio.

Together with other stocks exited, the total number of stocks in Argo’s investment portfolio decreased from 95 to 89.


----------



## Belli (17 August 2020)

Seems ARG is slowly exiting MLT.

Previous final dividend of 17c included 4c LIC Capital Gain whereas this one doesn't include any.

Expecting a subdued environment to say the least.  I notice in the media release it used the example of CBA reducing its final dividend by 58%.  Going to be interesting quarterly distributions from VAS and others.  We'll find that out in late September.


----------



## Dona Ferentes (2 October 2020)

strip away the jingoism, and the notion of 'picking winners', Jason Beddow has had a few words to say on what may happen, or at least where, as a value based and long term investment manager, they might put client money

_The Morrison government's proposed push on Australian *manufacturing*, which is expected to form part of next week's federal budget, has elicited an optimistic reception from investors who agree it's a good idea to enliven businesses struck by COVID-19.__ Six areas of manufacturing have been identified as the likely focus of  “__*sovereign capability*__” within 10 years. The sectors are: 
- space, 
- defence, 
- food and beverages, 
- clean energy and recycling, 
- resources and critical minerals, and _
_-medical products.

"We have shot ourselves in the foot with our *energy *policy," _said Jason Beddow at Argo Investment Management_. "Australia is such a high cost place to do business today_." The federal government is working with the states to accelerate the construction of critical energy infrastructure. Such infrastructure was a harder area for equity investors to key into, said Mr Beddow. _"There's not that many ways to play it really. CIMIC is listed but it's pretty illiquid and there's some question marks around their corporate governance_." Downer and some of the smaller contractors and service providers are possibilities, but they are at the smaller end of the market.

Mr Beddow said he would welcome a return of high-tech, heavily automated manufacturing to Australia but acknowledged that any such move would likely be restricted to niche segments.


> "It's hard to see anything on a grand scale that's going to make a lot of economic sense, unfortunately." He is doubtful that supply chain changes will lead to a renewed focus on domestic alternatives: "It might mean for an Australian company that you source from Turkey, China and Vietnam rather than just China perhaps," he said.



That being so, housing and infrastructure are likely to be some of the key areas to benefit from the imminent budget. Building materials stocks including CSR, James Hardie and Adbri have already started to rally ahead of next week.







> "They are an obvious beneficiary from the budget and there's a pretty direct correlation," said Mr Beddow. "If there's more housing starts or more incentives – particularly low interest rates – people will probably buy [or] build more housing. "I don't think that there's a lot of direct effect outside the builders."





..._ well, that isn't Innovation Central.  Maybe this country doesn't mix *grand scale* and *economic sense *well. _


----------



## kenny (3 October 2020)

Given your post and the growing failure of significant allocations of many LIC's holdings to protect capital let alone generate reliable returns; does the LIC industry need to reconsider their "Buy & hold" strategy and look to re-weight their holdings?

Selling down sizable holdings of the banks and financials will trigger significant capital gains. Where do conservative players like ARG and AFIC redeploy to?


----------



## Dona Ferentes (7 October 2020)

kenny said:


> .... LIC's holdings to protect capital
> .... [&] generate reliable returns;
> does the LIC industry need to reconsider their "Buy & hold" strategy and look to re-weight their holdings?
> 
> Selling down sizable holdings of the banks and financials will trigger significant capital gains. Where do conservative players like ARG and AFIC redeploy to?



each LIC is different. I think the older LICs, such as ARG, the AFI stable, and Milton (& maybe WAM stable) are different to the newer _manager aligned _hotshots, which seem to have higher fee structures and often are just listed echoes of unlisted managed funds

ARG states
*Company objective*
 _Maximise long-term returns to shareholders through a balance of capital and dividend growth, by investing in a diversified Australian equities portfolio which is actively managed in a tax-aware manner within a low-cost structure._
_*Investment approach *
Extensive research and meetings to identify well-managed businesses in sound industries, with good cash flow and potential dividend growth. Argo buys or adds to holdings when prices compare favourably to long-term valuations._

There isn't an explicit 'capital protection' there, but a set of practices that over time produce positive returns. Don't forget, most market based investments have a 5-7 year timeline. The economic cycle can't be avoided, but risk can be lowered. One aspect, that of a profit reserve, is useful for delivering smoother dividends over time.

The reweight of holdings comes over time. From the ARG website 







> The selling of investments is relatively rare and generally only occurs due to takeovers or when it is perceived that the long-term value of an investment is compromised by deteriorating industry conditions or other concerns.



Occasionally a takeover (with CG implications) delivers up a pool of new investment money. It is a far different story to sell down without appearing to be a distressed seller. The_ tax-aware manner _can reflect the fact that parcels were accumulated on the way in (up) and gains allocated to parcels on the way out. And offset against losses, if necessary. Being a longer term holder with low turnover helps minimise tax exposure, by definition

Where is capital redeployed to? Access to IPOs and, especially, rights issues of late. Again, done within the Company objective and through the Investment Approach. The website goes into more detail. https://www.argoinvestments.com.au/investment-process/investment-process

_- _(_ LT HOLD. Since 2005. Added to on occasion. <as part of my barbell approach; solid LT dividend payers managed in the LICs, not much in the middle, then speccies either traded or hoping for Free Carry> _)


----------



## Belli (7 October 2020)

Just to add to @Dona Ferentes's comment, the older LICs, in order to retain the ability to include a Capital Gain Discount in the dividend, is limited in the percentage of it's holdings it can turn over each year (around 10%.)

This would mean in order to wind down its holdings in banks and other sectors is likely to take place over a couple of years.


----------



## So_Cynical (7 October 2020)

kenny said:


> Given your post and the growing failure of significant allocations of many LIC's holdings to protect capital let alone generate reliable returns; does the LIC industry need to reconsider their "Buy & hold" strategy and look to re-weight their holdings?
> 
> Selling down sizable holdings of the banks and financials will trigger significant capital gains. Where do conservative players like ARG and AFIC redeploy to?




A 5 billion dollar domestically focused LIC has very limited investment opportunities, they are big so have to go big.


----------



## sptrawler (7 October 2020)

kenny said:


> Given your post and the growing failure of significant allocations of many LIC's holdings to protect capital let alone generate reliable returns; does the LIC industry need to reconsider their "Buy & hold" strategy and look to re-weight their holdings?
> 
> Selling down sizable holdings of the banks and financials will trigger significant capital gains. Where do conservative players like ARG and AFIC redeploy to?



I remember someone on here recently criticising AFI for selling down AMP, then criticising them for selling down banks and loading up on cleanaway.
I bought AFI and MLT pre the covid debacle, they are both down about 20c on the purchase price, but both have given two dividends since.
I wish all my dividend plays were performing as well, as it is important to have a dividend when it is a major form of your income.
I guess a lot depends on what stage of life you are in, as to what your investment objectives are and what recovery options you have.


----------



## Belli (8 October 2020)

sptrawler said:


> I remember someone on here recently criticising AFI for selling down AMP, then criticising them for selling down banks and loading up on cleanaway.
> I bought AFI and MLT pre the covid debacle, they are both down about 20c on the purchase price, but both have given two dividends since.
> I wish all my dividend plays were performing as well, as it is important to have a dividend when it is a major form of your income.
> I guess a lot depends on what stage of life you are in, as to what your investment objectives are and what recovery options you have.




I get your point.  For the second half of FY 2019-20 VAS distributions were down around 50% compared with the first half while ARG is down by 12% - and using reserves which ETFs don't have.  Then have to bear in mind one has 300 shares and the other less than a 100.

And there is the mix too.

ARG is 15% to Materials whereas VAS is 20%.  Real Estate 3% v 7% and so it goes.  Probably other older LICs are similar.  MIR (comparatively the new little kid on the block) doesn't hold banks although it does have Other Financials.


----------



## Belli (8 October 2020)

As an aside at least with LICs the record keeping is cleaner than ETFs.  The sentence "Please Retain This Statement for Income Tax Purposes" on the annual statement from ETFs doesn't mean only for the relevant tax year.  You'll need it if you sell due to the AMIT cost-base adjustments.  Can be a bit of a pain if people do a partial sell down through the year but a good accountant will sort it out - hopefully.


----------



## kenny (8 October 2020)

sptrawler said:


> I wish all my dividend plays were performing as well, as it is important to have a dividend when it is a major form of your income.
> I guess a lot depends on what stage of life you are in, as to what your investment objectives are and what recovery options you have.



It would be good to see whether the fund managers had to dip into reserves to maintain the dividend since some of their major holdings (looking at you; banks) dropped recent dividends.

I agree with your comment on investor profile however I would imagine a significant proportion of their shareholder base would be self funded retirees relying on the dividends for passive income. Many will be anxious where they may need to shift to in order to maintain their income without moving up the risk curve.


----------



## sptrawler (8 October 2020)

kenny said:


> It would be good to see whether the fund managers had to dip into reserves to maintain the dividend since some of their major holdings (looking at you; banks) dropped recent dividends.
> 
> I agree with your comment on investor profile however I would imagine a significant proportion of their shareholder base would be self funded retirees relying on the dividends for passive income. Many will be anxious where they may need to shift to in order to maintain their income without moving up the risk curve.



At least we still kept the franking credits, without them it would be very difficult, many would be going onto a government pension IMO.


----------



## Belli (9 October 2020)

sptrawler said:


> At least we still kept the franking credits, without them it would be very difficult, many would be going onto a government pension IMO.




I suppose so.  As for me it's not an issue apart from the relevant data needing to be included in my income tax return.  It's the only time it has any impact. 

Frankly (pun intended) I consider it unwise to rely on a tax refund to pay the bills. 

And franking will likely be altered downwards in the next few years according to the program implemented by Treasury.  So franking salivatos prepare for a reduction of some  5%.

Any whine about changing the goal post to be dismissed with the disdain it deserves - by me at least.


----------



## sptrawler (9 October 2020)

Belli said:


> I suppose so.  As for me it's not an issue apart from the relevant data needing to be included in my income tax return.  It's the only time it has any impact.
> 
> Frankly (pun intended) I consider it unwise to rely on a tax refund to pay the bills.
> 
> ...



Well I will look forward to your thoughts, when you are made redundant at 55 and have to rely on your investments until you are 67.
Cant wait to see how you you fund that👍
If you are receiving 1% on term deposits, the banks are paying minimal dividends, maybe you can suggest a way self funded people can make ends meet, I certainly am open to suggestions.
Maybe it is one of those hollistic things, you have saved, you have done without, now you have it so spend it.
I actually dont have a problem with that, I hope you dont.lol
The reality that is being created, is the reality the next generation have to live with, I hope they enjoy it.
I dont think they are smart enough to understand the ramifications, way too much brainwashing by the media IMO.
You dont get welfare before pension age, unless you have nothing.lol
So I have 1 year to go, how about you Belli?


----------



## Belli (12 October 2020)

sptrawler said:


> Maybe it is one of those hollistic things, you have saved, you have done without, now you have it so spend it.
> I actually dont have a problem with that, I hope you dont.lol




That's how it worked.  Never got a redundancy as they wouldn't give me one but they had ways of making life unpleasant enough.  Left with remaining long-service leave and holiday pay.

As for any tax refund, never spent it but treated it as a windfall not to be wasted and reinvested it in the market.


----------



## dyna (12 October 2020)

Quite a few LIC's are working their portfolios a fair bit harder,now.Maybe a clue there for the rest of us.Why wait for dividend streams to start flowing again? Take profits where you can,maybe drawing down capital will become the norm in  our future........sorry kids,you still get the house....Not much else,though.


----------



## Belli (12 October 2020)

Broad conversation which may not be suited to this particular thread but I have known of some in their 80's sitting on $700k+ complaing about cash shortage.  It's rough I know but at 80 life expectancy is...?  Draw down of say $20k pa to assist would generally still leave around $500k at 90. Wouldn't worry about the accommodation bond issues at buggers would take the lot anyway.


----------



## Belli (31 December 2020)

8 February 2021 for ARG holders.  Not as large a market cap at $6B compared with AFI but big enough.


----------



## Belli (8 February 2021)

ARG reported this morning.

No surprises.  Profit down by 43% to $67.4m.  EPS down 44% to 9.3c.  Dividend 14c ff (down from 16c ff pcp) which is a 12.5% reduction so reserves were used to support the dividend (146% Payout Ratio).

Sold out of AMP and Ansell.  Added Aurizon Holdings  and Newcrest Mining.

Hold and will be adding more from MIR dividend which is payable shortly.


----------



## Dona Ferentes (8 February 2021)

There would be some optimism that dividend flow will be restored to trend,


> _With little earnings guidance from many listed Australian corporates, we are particularly focussed on the local reporting season, which has begun to get underway. Outlook statements for the coming year will be especially important, as businesses navigate their new operating and trading environments. We are encouraged by the prospect of company dividends to shareholders beginning to recover._




As well as adding to some holdings, I was intrigued by the 'toe in the water' approach to emerging sectors


> _The total number of stocks in Argo's diversified investment portfolio increased from *89 to 92* with some smaller companies in the *digital payments, technology and battery commodities sectors* added to the portfolio_*.*


----------



## Belli (8 February 2021)

Dona Ferentes said:


> There would be some optimism that dividend flow will be restored to trend,




There is that for sure although I work on the basis until it happens it hasn't.


----------



## peter2 (8 February 2021)

@Dona Ferentes  This is another large cap fund manager that has started to include some small cap companies. Acknowledgement that growth will come from the smaller cap companies and that the demand for EV minerals and tech that improves productivity remains very strong.


----------



## kenny (8 February 2021)

I wonder where the small caps allocation is coming from? Are they reducing the size of deployment to every other stock pro rata or selectively?


----------



## Dona Ferentes (8 February 2021)

kenny said:


> I wonder where the small caps allocation is coming from? Are they reducing the size of deployment to every other stock pro rata or selectively?



specific answer to that, @kenny. Not pro rata, but yes selectively. It's a myth they are _buy n hold_ only, more that long term the case to let something go, has to be strong.

Any buying of small caps;  Just toe in the water stuff, I'd reckon. A few mill out of $8B. The total positions are only revealed once a year, Annual report time, so it's wait and see.

I think it was Mirrabooka that stated they take a small entry and watch with the intention to add, when it comes to newcomers.

I'm glad they are doing this. And of course small caps are a broad category, some barely start-ups and some  paying dividends, and everything in between. It's the growth trajectory that matters. Most large cap mature entities started small.


----------



## Belli (8 February 2021)

peter2 said:


> This is another large cap fund manager that has started to include some small cap companies.




Its always had what could be considered smaller cap companies (Reece, Automotive Holdings and stuff like that).  With the change in personnel which has occurred over a period of time, they now seem to be willing to expand the investment world to a greater extent.


----------



## kenny (8 February 2021)

Dona Ferentes said:


> Any buying of small caps; Just toe in the water stuff, I'd reckon. A few mill out of $8B. The total positions are only revealed once a year, Annual report time, so it's wait and see.



So very similar to AFIC's "nursery stocks" where they initiate some exposure with the potential for more? 

It will be interesting to see who in the Argo Investment Team are driving the selection and analysis.


----------



## Belli (16 August 2021)

ARG reported this morning.  Dividend of 14c ff remains the same as pcp.  Includes 8c LIC Capital Gain discount. Payable 17 September.  DRP at 2% discount.

Profit down 12.8%.  Hefty increase in reserves from $1,343m to $2,255m. Cash increased from $169m to $179m.


----------



## Dona Ferentes (16 August 2021)

kenny said:


> So very similar to AFIC's "nursery stocks" where they initiate some exposure with the potential for more?
> It will be interesting to see who in the Argo Investment Team are driving the selection and analysis.



The total number of stocks held increased slightly to 90. The larger movements in the portfolio were:   
*Purchases *
Aurizon Holdings*  
Downer EDI 
EML Payments* 
IGO* 
Newcrest Mining* 
Suncorp Group 
Sydney Airport 
The Star Entertainment Group 
*   _New portfolio position  _

*Sales*
ANZ Banking Group 
Boral  (now out since EoFY)
Commonwealth Bank of Australia 
James Hardie Industries 
Vocus Group (takeover)
Washington H. Soul Pattinson


----------



## Dona Ferentes (24 August 2021)

Dona Ferentes said:


> The larger movements in the portfolio:




_and, reading through the Annual Report, as well as the major moves in and out of the portfolio, ARG has taken some smaller positions on some new companies, while exiting others, including a couple of chronic underperformers like AMP and FNP._



> New stocks added to the portfolio were Carbon Revolution (CBR), Endeavour Group (demerged from Woolworths), HUB24 (takeover of Xplore Wealth), Songtradr Inc and Superloop (SLC).






> Other stocks exited were AMP, Ansell, Freedom Foods Group, Iluka Resources, Orora, Perpetual and Xplore Wealth (taken over by HUB24).




During the year, Argo outlaid $350 million on investment purchases and $358 million was received due to disposals and takeover proceeds (this turnover is only a bit over 5%, as ARG has > $6B under management). The total number of holdings in the portfolio increased slightly to 90.


----------



## Dona Ferentes (17 September 2021)

Dona Ferentes said:


> _and, reading through the Annual Report, as well as the major moves in and out of the portfolio, ARG has taken some smaller positions on some new companies, while exiting others...... _During the year, Argo outlaid $350 million on investment purchases and $358 million was received due to disposals and takeover proceeds. The total number of holdings in the portfolio increased slightly to 90.



And today is the day the Argo dividend is paid. A good predictable income stream, on top of market exposure.

The company has taken the opportunity to address matters, perhaps flying the flag for changes in this age of transformation, whilst assuaging those others wanting what they consider to be safety?

_Argo has added a number of holdings to the portfolio with exposure to *renewable energy and decarbonisation thematics*. In particular, there are several new stocks exposed to the rapidly growing demand for electric vehicles (EVs) globally, including Novonix, IGO, Carbon Revolution and Lynas Rare Earths. 

These growing companies sit alongside our largest holding, Macquarie Group, which is now one of the world's largest infrastructure managers and the owner of *Green Investment Group,* a leading provider of finance, development and advisory services in the renewable energy sector. *Novonix*, which experienced a share price jump of 75% in August alone, produces anode material for battery manufacturers. *IGO *mines for lithium and nickel, both important elements in battery manufacture. *Carbon Revolution* manufactures carbon fibre wheels, which are light and ideal for EVs. *Lynas Rare Earths *is the largest producer and processor of separated rare earths outside China, making it an important strategic supplier to many high tech and low carbon industries, including magnets for wind turbines, solar cells and EVs.

This growing area is not without risk, as share prices will be volatile and dividends relatively low for some time. However in the longer term we see these new technologies as an important part of achieving future capital growth for Argo shareholders, while we continue to provide reliable dividend income, driven by our more traditional *blue chip* holdings such as banks, healthcare and diversified resources giants Rio Tinto and BHP Group._


----------



## Dona Ferentes (24 September 2021)

Yep, these buy and hold outfits are so predictable:


----------



## Dona Ferentes (12 January 2022)

Argo comes out with its monthly NTA today, at $9.52 up from $9.29 at end November, and commentary includes


> _"Pleasingly, Argo's share price recently reached a new record high of $10.29"_




And today, admittedly a strong day on the market, it moved 21c , up to $10.38

*Top 20 holdings:*
MQG .. 7.5%
CSL .... 4.9 %
WES ... 4.3 %
CBA ... 4.0 %
ANZ ... 3.3 %
RIO .... 3.0 %
WBC ... 2.6 %
SHL .... 2.5 %
NAB ...2.5 %
REH .... 2.2 %
ALL .... 2.2 %
RHC .... 2.1 %
SYD .... 2.0 %
WOW ...1.9 %
TCL ..... 1.8 %
NVX ..... 1.8 %
AUI ..... 1.7 %
APA .... 1.7 %
Top 20 equity investments 59.5%
Cash and cash equivalents 1.2%

Market cap. .... $7.4bn 
Shareholders .. 95,200 
Dividend yield .. 2.8% 
MER ................... 0.14%


----------



## dyna (12 January 2022)

Note the Management Expense Ratio of just 14 basis points , 0.14% .

Magellan was creaming a management fee of 1.73 % off the  St Jame's Palace holding.
Where ever that $ 23 Billion goes now, it won't cop that again.


----------



## InsvestoBoy (12 January 2022)

Dona Ferentes said:


> Yep, these buy and hold outfits are so predictable:
> 
> View attachment 130664




I can't tell you how much I love this photo, thanks so much for posting it.


----------



## InsvestoBoy (12 January 2022)

Dona Ferentes said:


> Argo comes out with its monthly NTA today, at $9.52 up from $9.29 at end November, and commentary includes
> 
> 
> And today, admittedly a strong day on the market, it moved 21c , up to $10.38
> ...




MQG has been quite the performer. I bought a small parcel at $120 on a larkin Sep '20 and thought it was just going to proxy market beta.


----------



## Belli (12 January 2022)

The SMSF, as well as myself, have held ARG for many years.  So long ago the brokerage, including stamp duty, on the first purchase was ................. wait for it............$108.90!

It should report sometime in February based on its past reporting.


----------



## Belli (12 January 2022)

InsvestoBoy said:


> I can't tell you how much I love this photo, thanks so much for posting it.




It's an insert in honour of the company's 75th annual report.



			https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02425605


----------



## divs4ever (13 January 2022)

Dona Ferentes said:


> Yep, these buy and hold outfits are so predictable:
> 
> View attachment 130664



 interesting to see the list of household names   still in the ASX 200 ( sarcasm ) 

 makes you wonder about 'buy , hold, and forget ' strategy


----------



## Belli (13 January 2022)

What a silly statement you have made.

There is a vast difference between an individual applying "buy, hold and forget" approach and the investing activities of an LIC.


----------



## dyna (13 January 2022)

divs4ever said:


> interesting to see the list of household names still in the ASX 200 ( sarcasm )
> 
> makes you wonder about 'buy , hold, and forget ' strategy



Yes indeed and those were the days when this country actually made stuff. A lot of those companies were still going strong, well into the 1970's and 80's that I can remember. Takeovers and the scrap yard ,was probably where the assets ended their lives. Comm Eng had a big old belt driven lathe from the 19 th century, originally used to make butter churning machinery ,( I saw a photo of it, somewhere in a museum) then up -dated for railstock repairs.


----------



## Dona Ferentes (13 January 2022)

dyna said:


> Yes indeed and those were the days when this country actually made stuff. A lot of those companies were still going strong, well into the 1970's and 80's that I can remember. Takeovers and the scrap yard ,was probably where the assets ended their lives. Comm Eng had a big old belt driven lathe from the 19 th century, originally used to make butter churning machinery ,( I saw a photo of it, somewhere in a museum) then up -dated for railstock repairs.



The list is interesting, Takeovers and the scrap heap, indeed.


Zinc Industries merged with Imperial Smelting Corp to become Consolidated Zinc, to become RTZ, then CRA to be absorbed (!) into RIO . I wonder if the original holding is still there.
Broken Hill South. Perilya (now Chinese) owns and operates the iconic Broken Hill South zinc, lead and silver mine . http://www.perilya.com.au/about-us/history
Lion Brewing -> SA Brewing -> Lion Nathan ?
Elder Smith - morphed (+ Goldsborough Mort) and morphed again, and again . Now Elders
Cyclone .  still around https://www.cyclone.com.au/gardening-tools/heritage/
Comeng - a twisted tale. (and Comeng trams 1988 - same as Melbourne ones - still rolling in Tuen Mun, HK not so long ago)
and some of the others, displaced by imports ! Sold for land value?


----------



## divs4ever (13 January 2022)

Belli said:


> What a silly statement you have made.
> 
> There is a vast difference between an individual applying "buy, hold and forget" approach and the investing activities of an LIC.



 SOME  people  buy  a  LIC ( or ETF ) and don't look at what they are doing for years 

 now i am NOT  suggesting you  change  to a different one every two or three years  (  chasing a better performance ) but just keep an eye on your investment just in case a change is warranted  ( OR any new cash injections might have a better home  available )

 i have one  LIC that  threw away the original mandate  ( ex top 50  on the ASX  div. payers  ) to go to a global long/short strategy   via an outsourced investment manager , while WIC is likely to turn into WAM  unless i sell them first .

now i hold SOL , but how many of those former MLT  holders are going to be smiling ??

 also  the article  highlights how much  the 'prominent  companies ' listed on the ASX can change in 70 years 

 now ARG has done a wonderful job navigating those  changes  , but how many other fund managers stumbled in that time .


----------



## divs4ever (13 January 2022)

Dona Ferentes said:


> The list is interesting, Takeovers and the scrap heap, indeed.
> 
> 
> Zinc Industries merged with Imperial Smelting Corp to become Consolidated Zinc, to become RTZ, then CRA to be absorbed (!) into RIO . I wonder if the original holding is still there.
> ...



 what happened to Moulded Products   , i inherited  some certificates of theirs  ( although i think  they were originally  bought as Nylex  .. looks to be a Nylex  certificate over-stamped Moulded Products )


----------



## sptrawler (13 January 2022)

divs4ever said:


> SOME  people  buy  a  LIC ( or ETF ) and don't look at what they are doing for years
> 
> now i am NOT  suggesting you  change  to a different one every two or three years  (  chasing a better performance ) but just keep an eye on your investment just in case a change is warranted  ( OR any new cash injections might have a better home  available )
> 
> ...



Good point, I sold MLT when they said I would get SOL shares.
Never been interested in SOL or Platinum or many others, investments have to resonate with me, some dont.


----------



## divs4ever (13 January 2022)

although i have held  SOL since  2011 ( and they have  gone up well over 100% since )  the silver lining  is the shareholder reports talking about the companies they have invested in   , so you get some divs from SOL but notice CLV must be close to a turnaround  ( in 2015 ) so you carefully accumulate ( from 28 cents down to 17 cents )   CLV  eventually came good i rescued the investment cash  in CLV and twice the cash i invested in SOL  and still hold both .

 investments in TPG and BKW  have been nice too  , but you needed to roll up the sleeves and carefully open your wallet  to get the best of SOL ,  

 now MLT , ARG , and AFI do most of the work for you  , and if you busy earning a main income elsewhere .. that can be perfect for you ( better returns than the bank account and franking credits to boot )


----------



## Belli (26 January 2022)

If according to reports, AFI has to sell into the Sydney Airport takeover, then it also means ARG will need to do likewise.


----------



## Dona Ferentes (26 January 2022)

Belli said:


> If according to reports, AFI has to sell into the Sydney Airport takeover, then it also means ARG will need to do likewise.




There is a report in the AFR:


> One of Sydney Airport’s biggest institutional investors, the Australian Foundation Investment Company, is a “very reluctant seller” of Sydney Airport’s shares but is resigned to the $23.6 billion takeover proceeding. But AFIC has been trimming its holdings as an investor vote on the takeover approaches on February 3 and thinks the cash offer of $8.75 per share will go through, managing director Mark Freeman said.






> _“We were a very reluctant seller. We’re a long-term investor,” _Mr Freeman told _The Australian Financial Review. “We think it would have been an investment in the portfolio for the next 10 years, but at the same time [we saw] the reality of what was going to happen."_




If the SYD takeover proceeds, then ARG will take the cash. Yes. As will AFI. A shame . At least there will be an amount of the pre-tax attributable gain, known as an “LIC capital gain”, attached to the next dividend  (EDIT: August 2022, not the upcoming one).


----------



## Belli (27 January 2022)

Dona Ferentes said:


> At least there will be an amount of the pre-tax attributable gain, known as an “LIC capital gain”, attached to the next dividend (EDIT: August 2022, not the upcoming one).




Yeah.  Holders of various ETF's will get a portion of the discounted capital gains at end of the FY too.


----------



## Dona Ferentes (7 February 2022)

And Half Yearly out

Argo Investments will pay an interim fully franked dividend of 16¢ a share, up from 14¢, after delivering a portfolio return of 7.3 per cent over the half based on its NTA growth.  This  beat the market’s return of 3.8 per cent for the S&P/ASX Accumulation index, after costs and tax. 



> “_In the immediate term, we expect conditions to remain challenging as markets globally digest the effects of rising inflation and the realisation that interest rate rises are imminent."_



Major additions were in EML Payments, Aurizon Holdings, Lendlease, CSL, Macquarie and entered a new position in RAM Essential Services Property Fund. It sold down Washington H. Soul Pattinson and exited Boral, Crown Resorts and AGL Energy.


----------



## Belli (7 February 2022)

Dona Ferentes said:


> It sold down Washington H. Soul Pattinson and exited Boral, Crown Resorts and AGL Energy.




I suspect that, since ARG held both SOL and MLT, it decided to take the special dividend from MLT and then sell down all or part of the SOL allocation or even possibly a greater amount of SOL.  Interesting there is no LIC Capital Gain discount included in this dividend.


----------



## Dona Ferentes (8 March 2022)

A SPP opens on Friday 11 March 2022 and offers eligible shareholders the opportunity to acquire up to $30,000 of new fully paid ordinary shares in Argo

The SPP price will be the LOWER of: 
•* $9.30 *per SPP share (maximum price*), which is a 2% discount to the closing price of Argo shares on the record date for SPP entitlement (07 March 2022); OR  
• The volume-weighted average price of Argo shares traded on the ASX over the last 5 trading days of the SPP Offer period (18 March 2022 to *24 March 2022* inclusive), rounded down to the nearest cent. 
 *_The maximum price equates to a 3.5% discount_

;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
But the NTA just released for end of Feb is $8.83 (_ex divi_). Market is choppy; uncertainty abounds.  Also just a week to get money in?


----------



## sptrawler (8 March 2022)

@Dona Ferentes I'm with you.  Everyone to their own I guess. Past performance not a guide to future performance and all that stuff, DYOR,


----------



## Belli (8 March 2022)

I'll be preferencing the MIR SPP over the ARG SPP.  With my current holdings in ARG, WHF & VAS I prefer more ex-50 which is where MIR sits.


----------



## divs4ever (8 March 2022)

i have been preferring  ex-50 ( focused  LICs  ) over the large cap. focused  ( LICs ) CURRENTLY  , but that may change in the future  ( especially if more large caps   become fair value )


----------



## Belli (9 March 2022)

Dona Ferentes said:


> Also just a week to get money in?




As ARG pays its dividend on 11 March so......


----------



## Dona Ferentes (9 March 2022)

Belli said:


> I'll be preferencing the MIR SPP over the ARG SPP...



Ditto.


----------



## Dona Ferentes (29 March 2022)

Applications totalling $191.8 million were accepted from 14,544 eligible shareholders (out of 95,500). 

_*No scale back*_ was applied to applications and as a result, 20,628,655 new Argo shares will be issued on Thursday 31 March 2022 at the subscription price of* $9.30 *per share


----------



## Belli (15 August 2022)

ARG has increased dividend to 17c ff which is payable on 16 September.  15c of that dividend is subject to LIC Capital Gains.


----------



## Dona Ferentes (15 August 2022)

Belli said:


> ARG has increased dividend to 17c ff which is payable on 16 September.  15c of that dividend is subject to LIC Capital Gains.



Thanks, Belli. the dividend suits me just fine.  The LIC capital Gains : _from a number of substantial capital gains in the portfolio being crystallised, led by the takeover of Sydney Airport, one of our larger holdings._ 

_Argo’s share price returned +1.6%, outperforming Australian shares by +8.1% and closed at a slight premium to the per share asset backing._

Also, I am glad to see they are clearing out the double dipping (AUI, SOL) to some extent.

The larger movements in Argo’s portfolio during the period were: 

*Purchases *
Aristocrat Leisure
Aurizon Holdings
BHP
EML Payments
Lendlease Group
Megaport*
RAM Essential Services Property Fund*
Santos
Superloop

*Sales *
AGL Energy**
Australian United Investment Company
Boral**
Crown Resorts**
Oil Search (takeover)**
Spark Infrastructure (takeover)**
Sydney Airport (takeover)**
Washington H. Soul Pattinson

*_ new position
** fully exited_


----------



## Belli (15 August 2022)

Had a very quick look at teh accounts.  Dividends and distributions increased by $129.4M and retained earnings by $153.1M.  Seems ARG is holding back on dividends based on earnings and deciding capital gains will apply to the majority of this dividend.  Capital management and provisioning.


----------



## divs4ever (15 August 2022)

Dona Ferentes said:


> Thanks, Belli. the dividend suits me just fine.  The LIC capital Gains : _from a number of substantial capital gains in the portfolio being crystallised, led by the takeover of Sydney Airport, one of our larger holdings._
> 
> _Argo’s share price returned +1.6%, outperforming Australian shares by +8.1% and closed at a slight premium to the per share asset backing._
> 
> ...



 interesting  , i bought into REP as well ( just significantly less than ARG )  but am surprised they are adding to BHP in the past year  ( below $25  for me even when carrying the now divested WDS )

 i was glad to lose SYD , but sad to see SKI go  ( fairly neutral over CWN )


----------



## Belli (16 August 2022)

I gather from postings in another thread, the management of ARG would seem to have a greater understanding as to why the LIC added to its holdings in BHP despite the surprise expressed by some.  I believe their time-frame is longer than the next tick on the share price movement.


----------



## Belli (31 August 2022)

ARG has released its Annual Report.



			https://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=02561088
		


Contrary to popular belief during 2022FY it did not rush to fill its boots with shares in the Big 4 banks.  It may have since 1 July but that is an unkown.

ANZ: 8.3m shares: no change
CBA: 2.8m shares: no change
NAB: 5.9m shares: no change
WBC: 8.4m shares: no change

MQG: 2.6m shares: added 100k shares

The list of shares starts at page 72 of the document (Item 30.)


----------



## Belli (16 September 2022)

A minor gripe but the share registry for ARG is awful.  It's only redeeming feature whcih I can see is the ability to link holdings via the HIN/SRN if the other entity also has ARG e.g. held personally and in the SMSF.


----------



## Belli (16 September 2022)

May as well post my other gripe with the share registry.  It only has a limited history of transactions.  In my case it is from 2015 yet I have many transactions in ARG before then.  If I require those transactions I need to contact Boardroom (and pay a fee I assume.)

It is a reason I never rely on share registries or brokers to maintain records.


----------



## dyna (16 September 2022)

Belli said:


> It is a reason I never rely on share registries or brokers to maintain records.



Same here. 
I also annoy the hell out of everyone by getting all dividend notices through the mailbox.
Nobody gets my email address, either.....Stuff 'em all !


----------



## Belli (16 September 2022)

dyna said:


> Same here.
> I also annoy the hell out of everyone by getting all dividend notices through the mailbox.
> Nobody gets my email address, either.....Stuff 'em all !




I don't go as far as that.  In the past I've had mail go missing so I don't rely on that either.

However, I do login to the relevant share registries to download the information I require.  After a while the pattern of when advices become available do become apparent.


----------

