LIC Investing In Australia – 10 Factors To Check Before Buying

9) Future Dividend Capacity

  • Don’t get overly fixated on historic yields, if dividends are cut this could see an adverse share price reaction.
  • Examine profit reserves, available franking credits, & current/future potential investment performance. An improving dividend picture in the future can sometimes cause a large positive share price reaction. Look forward more than you look back in the rear vision mirror.

10) Marketing / Reporting of the LIC.

  • LICs that make a minimal effort with the information they give out in monthly NTA releases can trade cheaper as a result.
  • Also if there is no effort to occasionally engage with the financial media then it may be more likely to trade at a discount to NTA in the future.

Hope this helps!

11) Does the LIC have a pirate-themed name?

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