AFI - Australian Foundation Investment Company

[Muschu]

I'm a retiree with a SMSF who was essentially out of the market for some time. I began to re-enter mid-2012 and progressively bought both AFI and ARG. One is up 17%, the other 11% - including dividends but not the franking credits.

With the volatility that has been going on these 2 buys have served me well. [To date].

 

[Garpal Gumnut]

I'm a retiree with a SMSF who was essentially out of the market for some time. I began to re-enter mid-2012 and progressively bought both AFI and ARG. One is up 17%, the other 11% - including dividends but not the franking credits.

With the volatility that has been going on these 2 buys have served me well. [To date].

Good plan.

Only buy them when the world of stocks is going to damnation.

They are my Al Swearengen (Deadwood) stocks, and like you have been good.

gg

 

[Judd]

A ho hum share to many. However, those who hold will have received the share purchase plan offer for up to $15,000 which closes on 25 September.

 

[VSntchr]

A ho hum share to many.

Indeed, but at the age of about 15 this was my first ever purchase! Influenced and conducted purely by VSntchr's PAPA of course!

 

[GlobeTrekker]

A ho hum share to many. However, those who hold will have received the share purchase plan offer for up to $15,000 which closes on 25 September.

The SPP price is slightly below NTA which makes this quite attractive as the AFIC share price has been at a moderate premium to NTA for a while now, though this has narrowed a bit recently.

 

[amf yoyo]

Hi,
I am starting out with stocks.
Don't have time for active research or chasing the
next big microcap.
What is the overall opinion?, where should
I start, say if I had 20k?. Choose index, or
bunch of individual shares e.g Telstra etc, or
Go AFIC.
Many thanks

 

[Muschu]

As a retiree I have held both AFI and ARG since exiting and re-entering the market. Charts good. Dividends acceptable. Fully franked. Good port in a storm.

I also hold TLS and have been fortunate. Average purchase price about $4.

 

[GlobeTrekker]

Hi,
I am starting out with stocks.
Don't have time for active research or chasing the
next big microcap.
What is the overall opinion?, where should
I start, say if I had 20k?. Choose index, or
bunch of individual shares e.g Telstra etc, or
Go AFIC.
Many thanks

AFIC is a fairly safe bet if you have a smallish amount to invest and want some diversification without having to pay lots of brokerage on individual shares, and if you don't have time for active research. Perfect for a set-and-forget investment strategy. Argo, Milton and BKI are similar, you could buy a bit of each if you want just that little bit more diversification without much more risk. These guys all tend to match or slightly outperform the Aussie index. Alternatively you could go for an ETF if you want to straight out match the index.

 

[pixel]

Since the last lot of fundamental assessments, AFI has come a little off the boil - just like the whole Market did. Therefore, it can also be expected that it bottoms out when the general Market does.

I routinely run a special scan across the entire ASX, trying to pick up just this kind of stocks that look like having found a bottom and about to reverse back up. "Just for fun", I have run this scan back over this week, and AFI is the first result. The alert came up for yesterday.



Key features:

• Momentum (MACD) shows Bullish Divergence to price Lows.
• "Speed" (red line in MACD) has turned positive, crossing above zero.
• Today's High is "tentatively" Primary Resistance, reinforced by (yellow) 1-year EMA and (red) 3-month EMA.
• Today's High also coincides with the tops of two long green wicks earlier this month.

Strategy:
I'll check tomorrow whether the resistance holds and if so, how far the pullback comes back. A rebound off support in the upper half - Fibonacci levels 50, 61.8, or 78.6% - is considered "strong" invitation to buy. A break above resistance on good supporting volume would allow me to top up or enter. Stop to be set depending on the entry; usually, I lift it quickly to the initial resistance level, which, once broken, needs to become support in this scenario.

For more details about my approach, see the new thread "Pixel's Picks" here:
https://www.aussiestockforums.com/forums/showthread.php?t=29112
and/or visit my website http://rettmer.com.au/ and use the left-most green entrance.

 

[pixel]

Not unexpectedly, the resistance held firm and I didn't buy yet:



$5.90-ish could potentially become support level, allowing a cautious entry.
To help me decide, I then switch to Intraday charts. I use the same Trinity script with Volatility Envelopes and break levels, but obviously with different time and volume parameters. Depending on position size, sensitivity, and the rate at which bids and offers change, I consult charts spaced at
Half-hourly:



5-minutes:



even down to 1 minute ticks.

 

[Dona Ferentes]

bit of an anomaly with AFI (but which probably won't last long)

Most holders of AFI - its a LIC that 'holds the market' to a large extent - are in for the longterm; a lot of SMSFs have it in portfolio .

Today at 4.10pm, someone dropped 106K of AFI (or nearly $600K in what is a thinly traded share) and it closed at $5.50 - its low for the last 12 months and notionally below the Dec 2015 NTA of $5.63 (again, a first for the year). But AFINA, the SPP issued share (at $5.51) is trading at $5.53, above AFI. That is weird as the next dividend - at least 9c ff and possibly 10c .. and to be announced on Wed 20th Jan - isn't included in AFINA. Notionally AFINA should, and generally has, traded about 10c + franking below AFI, of late.

 

[shouldaindex]

AFI also has 200m in debt, which I think means it should trade a slight discount (taking this factor in isolation) compared to debt free LICS such as ARG and MLT.

 

[coolcup]

bit of an anomaly with AFI (but which probably won't last long)

it closed at $5.50 - its low for the last 12 months and notionally below the Dec 2015 NTA of $5.63 (again, a first for the year).

AFI broadly speaking tracks the market right? The ASX 200 is down 8% since Dec 2015, so its NTA should fall by roughly the same amount if marked to market today, so ~$5.20. So selling at $5.50 is pretty rational behaviour when you look at it that way...

...on the other hand the lowest ask is still at $5.66 currently, so it probably won't stay at this level for long!

 

[Ferret]

AFI's half year report out today. I always find it interesting to see what they have been buying and selling. This half:

But what I find really interesting is this commentary:

AFI becoming more growth focused. I like it.

 

[Belli]

Has been progressively changing the mix for about five years. And finally dumped AMO I believe. ARG has changed its mix as well.

Not as "passive" as some think.

One sort of blurry eye so I haven't read any of the inserts

 

[Knobby22]

I like their new look! Might be tempted to buy in one day.

 

[Belli]

AFI also has 200m in debt,

Where did this figure come from? It's Annual report for EY 2019 stated it had no borrowings and in the previous year it was $100m.

 

[Dona Ferentes]

Where did this figure come from? .

that post was from 2016 and probably relates to AFIG, since converted. Technically debt, I suppose.

 

[Belli]

that post was from 2016

Doh!

 

[sptrawler]

It is good to see a couple of moves they have done, I have also, makes me feel a bit better.