07 June 2019: AFIC (AFI) have released their NTA & Top 25 Investments Report (as at 31 May 2019) this morning. During May, their NTA rose 9c from $6.19 to $6.28, which is a +1.45% rise, suggesting that (like both Milton Corporation - MLT - and Argo - ARG), AFI benefitted from their large weighting to the banking sector (and the rise of the big four banks post the federal election on May 18) but had other major holdings that detracted somewhat from that positive movement. Three of the big four banks rose by around +8% in May and the fourth (NAB) rose +10.7%. AFI's banking sector exposure should have added between +1.7% and +1.9% to their NTA, and their NTA rose by just under +1.5%, so they had some detractors in their portfolio.
Of the big 3 LICs, AFI (which is my favourite) did best, rising +1.45% in May, MLT was up +1.27% and ARG had a +1.2% rise in their NTA.
I don't personally own any shares in those 3. I do own WLE, which plays in the same space (large cap stocks), but WLE is more actively managed. AFI, ARG & MLT have far lower annual portfolio turnover (they don't change their portfolios much during each year), and I added them to my Strawman.com scorecard for a short term trade - based on the expected NTA uplift from the post-election relief rally in the banking sector. That uplift has been less than I anticipated. I'll be removing AFI from my scorecard today. Well, they'll still be on there, but they'll be a "sold" position. I have already removed/sold ARG & MLT - in the past two days, as they released their respective NTAs. I will keep WLE, as I do hold a reasonable position in WLE personally and I think the PM (portfolio manager) of WLE, Matt Haupt, is doing a reasonable job lately. It will be interesting to see how much exposure WLE had to the banking sector over the federal election weekend (in May). When they release their May 31st NTA we should get a fair idea. It would be a tad ironic if Matt ended up reducing exposure to the banks before the election expecting a Labor win, considering that his boss, Geoff Wilson, was instrumental in motivating so many people to campaign against Labor's proposed changes to the refundability of franking credits (imputation credits or company tax credits) - which ultimately significantly contributed to Labor losing an election they were widely expected to win. It was Geoff who first coined the term "Retirement Tax" - which caught on and was widely used by many of those opposed to the proposed changes (including myself). Hopefully, Matthew stayed as exposed as usual (which was always underweight versus the index anyway) to the banking sector and derived some benefit from the post-election rally in the sector. However, I also like WLE's exposure to the mining sector, especially some of the mid-cap miners like OZL, IGO & WSA. I hold IGO & WSA myself.