harcourt, page-10

Umm, have you read the prospectus?
The manager gets a 5 year agreement. not 15. not 25
The manager gets NO fee in years one and two.
I am confused as to how that is high.
They can earn a performance fee, calculated quarterly
It is subject to a whole lot of hoops, but is cash + 4% (so say 7%), and then theyearn 20% of any portfolio outperformance over that, limited to 1% in a 12 month period

So if they did 20%, and cash + 4 was 7%, they would earn 13% x 20% = 2.6%. But, it is capped at 1% in a year, so effectively, that means they get .20% of every 1% above 7% return, up to 12%, and then nothing about 12%

Am I in? Well, no

I will buy the options

I think the type of stocks they will hold will eek out 10% the next 12 months. But I'm looking at other stocks to give me a bit more of a hit

But will I say to my mother to look at this? Absolutely. Why? Its an LIC. LICs pay dividends. And in this instance, she will receive 1.8% of the July 1 NTA each year paid quarterly.

I can't see this trading at a discount either. Who's going to sell? She won't.

I will spend $2,000 speccing on the options.

The way I read this, its going to cost 2% to get this away, which is 1.5% for the stockbrokers. The 1 for 1 options people get give you the right to buy shares at $1 any time in the next 12 months.

I reckon they will trade between 1.5c and 2c. If I bought $2,000 worth I get 100,000 options

If the portfolio went up 10% then the options would go up 5% (napkin maths)

Thats from 2c to 5c, which turns $2k into $5k, which is a 150% return.

Which is why I am on HotCopper, and my mother needs to fund her Bowling Club subscriptions

NB Rhodon your comment about other costs is not fully thought out is it? Administrative costs and Directors fees? Have you found a companies where everyone works for free, and directors put their head on the block and attend 20 meetings a year and 500 emails a week and on and on, for the love of it? Let me know where to find a cost free investment!

40 stocks with good yield and growing earnings and sustainable income. That sounds like a good portfolio that is quietly shock proof.

I think I will stick with Microcap and let the workhorse Peters flog it hard to keep narrowing the discount

Incidentally, if this Midcap gets away and has no discount, watch Micro cap up to a 5 or 10% discount pickup too.

(DYOR, and I am really struggling to put a sentiment down lately)