Australian (ASX) Stock Market Forum

New to shares: Books on shares & investing in LICs?

Joined
26 October 2009
Posts
1
Reactions
0
Hey im new here , and to shares, so go easy!

I've always been interested in the idea of investing in shares, but unfortunately know very little on the subject. I found a couple of books which I thought would be a good read to get started, one is "Starting out in shares the ASX way" by the ASX (I believe) and the other is "The Rivkin Guide to Getting Started in Shares" by Jordan Rivkin (not the late Renne!)
Has anyone read these books, and do you think they'd be a good starting point?

Ultimately I'd like to be a successful day trading, flying my helicopter from my mansion to my office in the city, but I understand, for now, that's a pipe dream.

I happened across an episode of The Barefoot Investor over the weekend, and one segment of the show was answering the questions of new investors. The advice that was given over and over, was for new comers to look at investing in Listed Investment Companies (LIC's) and in particular AFI.

After a bit more investigation, it appears that for someone without a lot of money (up to $5000) investing in an LIC is a smart choice, as the company will use your money to increase their portfolio consisting of ASX 200 companies, of which your original $5000 wouldn't have purchased much.

This all sounds pretty good to me, but is there something I'm missing out on?
I understand that LIC's generally pay an interim and a final dividend per year, of about 13cents per share, meaning that $5000 original if bought into an LIC at $5/share will return you approximately $260 per year ($130 each dividend pay out). I also believe that the company pays tax on it's income (at 30% or something) hence no tax is required to be paid by me (the end trader) for money earnt from the dividend?

If in 5 years time, the LIC I invested in is trading at $10/share, I can then sell my 1000 shares, turning $5000 original investment into $10,000 - along with my 5 years of $260 dividend pay outs making a total of $11,300.

Does it seem that I have my head around this? Or am I way off?

Thanks, Mike.

Edit: Sorry meant to post this in the Beginners Lounge - could a moderator please move this thread?
 

So_Cynical

The Contrarian Averager
Joined
31 August 2007
Posts
7,447
Reactions
1,423
Re: New to shares books on shares & investing in LIC's?

If in 5 years time, the LIC I invested in is trading at $10/share, I can then sell my 1000 shares, turning $5000 original investment into $10,000 - along with my 5 years of $260 dividend pay outs making a total of $11,300.

Does it seem that I have my head around this? Or am I way off?

Hey Mike...Buying a LIC is an easy way to get some diversity into a portfolio or an easy way for a beginner/mum & dad/buy & hold type investor to get broad exposure to the big moves of the main index.
 
Joined
20 July 2021
Posts
8,474
Reactions
11,699

Exploring Australian Listed Investment Companies​


am not sure on how up to date this is

but gives a guide to fees charged by some of the largest ASX listed LICs
 
Joined
28 March 2013
Posts
468
Reactions
854
L. I . C . 's .
Yeah , I 've got them .
Are they any good ? Some of them are , but none of them are GREAT investments . ( Still , they are better than trying to outperform the market index with just one shot with your $ 5,000 at the say BHP )
E. T. F. 's are a fair bit better , ( less fees ) especially for overseas share exposure. Have a thorough look at them for what you really need at this early stage of your investing ....." Diversity "

If it's all too hard to chose from the myriad of ETF's just take the easy way out and ask this great mob right here who have the knowledge ! Plus there's no charge .
All free.
 
Last edited:
Joined
28 March 2013
Posts
468
Reactions
854
am not sure on how up to date this is
Jeebus Mr Divs ! Old mate , really !
Where do you find these ancient posts ?
Notice how " up to date" Mr. T is ?
14 years ago ! He was only here for 1 freakin' year . Just the one post and .......gone with the wind.
 
Joined
20 July 2021
Posts
8,474
Reactions
11,699
Mr Blow helped me it came up in the search engine he kindly pointed out to me

the other results under LICs didn't seem to be a good fit

but hopefully there will be plenty of novices joining ASF this year

( i was delighted to see how some fund managers had trimmed fees to compete with the ETF offerings , nice work guys/gals )
 
Top