I don't have any problems if they are lazy, if it means they are...

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llee7130

13 Posts.

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12/02/19

17:28

Post #: 37413658
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Originally posted by Stumpedup: ↑

I don't know llee . You could argue it either way. The investment rationale behind a share buy-back for a LIC is that "I can't find anything else in the market showing better value than our own shares". I think this is a lazy option, and very likely an incorrect one. And it still assumes the remaining investments in the fund will perform as expected. From the past 1-2 years it is evident the track record on stock picking is poor. It would be very different if the fund was in 80- 90% cash. Then the math stacks up. Will see at next report.

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Originally posted by Stumpedup: ↑

I don't know llee . You could argue it either way. The investment rationale behind a share buy-back for a LIC is that "I can't find anything else in the market showing better value than our own shares". I think this is a lazy option, and very likely an incorrect one. And it still assumes the remaining investments in the fund will perform as expected. From the past 1-2 years it is evident the track record on stock picking is poor. It would be very different if the fund was in 80- 90% cash. Then the math stacks up. Will see at next report.

Expand

I don't have any problems if they are lazy, if it means they are buying their best ideas (the current stocks in their portfolio) at a 20% discount to what they can buy them on the market - which is what they are doing when they are buying back their shares. If, they happen to find a better idea (which i admit they have been struggling to find for a while) they have plenty of liquidity to fund it.

ALF Price at posting: 96.0¢ Sentiment: Buy Disclosure: Held
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I don't have any problems if they are lazy, if it means they are...

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