LIC market slightly up in April
The total market capitalisation of the listed investment companies (LIC) market has increased to $28.8 billion in April from $27.8 billion a year ago, fuelled by diversity in the market, according to Zenith Investment Partners.
The Zenith's LIC Sector Review indicated that such a pace of growth capped two years of very strong market rise, which saw market capitalisation being driven up by 38.5 per cent since April, 2013.
Also, diversity in the market continued to expand, with an increase of LICs offering international exposure, however the market was still dominated with Australian LICs, as by market capitalisation.
Senior investment analyst at Zenith, Dugald Higgins, stressed that the sector continued to evolve bringing an increasing number of strategies on offer which "diversified away from the sector's historical Australian equities/long-only focus".
"LICs provide several potential benefits in relation to robust dividends and franking levels as well as efficiencies from managing a closed pool of assets."
"However, investors should be wary of not over-paying for the privilege, with many LICs continuing to trade at strong premium across the sector," he warned.
AUTHOR
Oksana Patron
Recommended for you
Global asset manager BlackRock has identified bringing private markets to the wealth channel as a key business area for the firm that could generate US$500 million in revenue in the future.
Flows into cash and fixed income ETFs soared in May, rising from $366 million in April to more than $1.3 billion, data from Betashares shows.
Quinbrook Infrastructure Partners has promoted its Australian head to the role of chief executive of the global investment manager.
UK-based fund manager Royal London Asset Management has appointed a Sydney-based head of regional sales as it embarks on a multiyear plan to expand its presence internationally.
