Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 189

Update on LIC developments

January’s update on LICs from Independent Investment Research (IIR) includes the reasoning behind recent suspensions of ratings for Hunter Hall and Contango MicroCap, three new funds entering the market, changes afoot for Century Australia plus the regular pricing and performance update.

IIR has suspended its rating for Hunter Hall Global Value (HHV) following the surprise resignation of its CIO. Although there is confidence in the remaining management team, any further loss of key personnel will have a negative impact. The two takeover offers that are in place add another level of uncertainty. HHV’s largest shareholder, Wilson Asset Management has also weighed in, recommending an equal-access share buy-back which has met with resistance.

The suspension of Contango MicroCap’s (CTN’s) rating was prompted by the unusual move to appoint an additional portfolio manager and rebrand away from the Contango name. IIR’s concerns lay with “the potential for differences in style and process to the existing manager”.

Three new ASX listings are detailed:

 

 

  • URB Investments Limited (URB) – is an urban renewal-themed investment company, which will invest in a range of assets, including property and infrastructure, focussing on urban renewal and regeneration.

 

  • The Switzer Dividend Growth Fund (SWTZ) – will be targeting consistent dividend and long-term capital growth by investing in high-yield Australian blue chips.

 

  • Fat Prophets Contrarian Fund – will consist of 15-25 international stocks, selected based on mispricings, plus a small element of short-term trading.

 

Century Australia (CYA) has recommended Wilson Asset Management’s restructure proposal, subject to an independent expert review. Shareholders are expected to vote on the proposal in early-March.

In the pricing and performance update, large cap focused LICs saw improved performance over the last quarter, but remained below index returns over the last 12 months. The current reporting season is also highlighting a trend for lower dividends. Small cap focused LICs performed strongly in the first half of 2016, but weakened in the second. This underperformance is expected to continue over the coming months. International focused LICs performed well on the back of a Trump-led US market rally, despite lower returns from emerging markets.

Access the full paper plus other LIC updates and reviews on our web page, Listed Investment Companies updates.

 

Leisa Bell is Assistant Editor at Cuffelinks.


 

Leave a Comment:

RELATED ARTICLES

Listed Investment Company deals for 2019

Latest LIC and ETF updates

LIC reporting season wrap for 2017

banner

Most viewed in recent weeks

Which generation had it toughest?

Each generation believes its economic challenges were uniquely tough - but what does the data say? A closer look reveals a more nuanced, complex story behind the generational hardship debate. 

100 Aussies: seven charts on who earns, pays, and owns

The Labor government is talking up tax reform to lift Australia’s ailing economic growth. Before any changes are made, it’s important to know who pays tax, who owns assets, and how much people have in their super for retirement.

The best way to get rich and retire early

This goes through the different options including shares, property and business ownership and declares a winner, as well as outlining the mindset needed to earn enough to never have to work again.

A perfect storm for housing affordability in Australia

Everyone has a theory as to why housing in Australia is so expensive. There are a lot of different factors at play, from skewed migration patterns to banking trends and housing's status as a national obsession.

Chinese steel - building a Sydney Harbour Bridge every 10 minutes

China's steel production, equivalent to building one Sydney Harbour Bridge every 10 minutes, has driven Australia's economic growth. With China's slowdown, what does this mean for Australia's economy and investments?

Supercharging the ‘4% rule’ to ensure a richer retirement

The creator of the 4% rule for retirement withdrawals, Bill Bengen, has written a new book outlining fresh strategies to outlive your money, including holding fewer stocks in early retirement before increasing allocations.

Latest Updates

Economy

The ‘priced out generation’ and what they should do about it

A fiery interview on housing exposed deep generational divides, sparking youth outrage and political backlash. As homeownership drifts out of reach, young Australians face a choice: fight the system - or redefine success.

Taxation

Maybe it’s time to consider taxing the family home

Australia could unlock smarter investment and greater equity by reforming housing tax concessions. Rethinking exemptions on the family home could benefit most Australians, especially renters and owners of modest homes.

Superannuation

Meg on SMSFs: Ageing and its financial challenges

Ageing SMSF members can face issues funding their pension income as cash reserves dwindle. Potential solutions include involving adult children in contributions to secure future financial stability.

Economy

US earnings season was almost too good to be true

The second quarter US earnings season has wrapped up, with a record 82% of S&P 500 firms beating earnings estimates. As tailwinds fade, Q3 may reveal whether AI momentum can offset rising economic headwinds. 

Gold

Does gold still deserve a place in a diversified portfolio?

9,000 years and no devaluations later, gold is the world’s most enduring store of value. It remains attractive as the value of several paper currencies, including the US dollar, are threatened by deficits and rising debt.

Shares

Checking in on the equity market's silent engine

Consumer spending directly impacts corporate earnings, sector performance and market sentiment. The latest data from different economies uncover risks and pockets of opportunity for investors.

Fixed interest

6 key themes driving bond markets

The Fed could soon be prompted to join other central banks in cutting interest rates. This would have ripple effects across global fixed income markets and provide an especially attractive backdrop for emerging market bonds.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.