LIC sector up
The Listed Investment Companies and Trusts Association (LICAT) has announced the listed investment companies (LICs) and listed investment trusts (LITs) sector has seen its market capitalisation rise 32% from a year ago.
This was helped by two initial public offering (IPO) capital raisings in June, amounting to $300 million at the end of June.
When excluding IPO capital, the sector also performed strongly at an underlying level and was up 31.4%, driven by increasing value of investment portfolios and the share price of the LICs and LITs themselves.
“Investors who bought LICs/LITs when they were trading cheaply relative to asset backing in 2020 have been able to generate particularly high returns,” LICAT’s chief officer Ian Irvine said.
“Not only have they benefited from the upswing in the market value of shares generally, but they have also received a supplementary return as the LIC/LIT shares themselves returned to a more normal trading level relative to asset backing.”
According to Irvine, it was also very encouraging to see the income/yield segment of the LIC/LIT sector performing well, with fixed income LITs continuing to pay unitholders regular monthly income.
AUTHOR
Oksana Patron
Recommended for you
Bennelong Funds Management chief executive John Burke has told Money Management that the firm is seeking to invest in boutiques in two specific asset classes as it identifies gaps in its product range.
Responsible investment performance concerns have lessened as the market hits $1.6 trillion in AUM, according to RIAA’s annual report, but greenwashing fears among asset managers are on the rise.
Research by Morningstar has found fixed income funds are bucking a general trend around managed fund fee dispersion with a smaller fee dispersion compared to equity ones.
As investors seek to diversify their portfolios, the naming of bond labels has broadened out to include green, social and impact bonds, according to the annual RIAA report.
