Features of AFIC

AFIC is a listed investment company investing in Australian equities with no upfront fees or commissions to third parties.

There are a number of advantages in investing in AFIC.

  • A diversified portfolio numbering around 100 of Australia's major companies.
  • A Board and Investment Committee with extensive investment skills and practical business experience.
  • A fund with no upfront fees or commissions to third parties — transaction costs will be borne when buying and selling AFIC shares through a stockbroker.
  • Management fees - 0.16% for the financial year to 30 June 2016
  • On-going capital management:
    • a dividend reinvestment plan which allows investors to cost effectively put their dividends back into the Company
    • from time to time, a share acquisition plan which allows shareholders to top up their holdings with no brokerage and sometimes at a small discount to the market price
    • activation of the share buy back program which gives the Company the flexibility to buy back shares at appropriate times, particularly if the shares start trading at a discount to their net asset backing
  • AFIC as a separate legal entity pays tax just like any other company. However the tax is small because companies receiving fully franked dividends do not need to pay any additional tax on the franked dividend. These fully franked dividends are passed straight through to the shareholders in March and August of each year. Certain Australian shareholders may also claim a tax benefit where the dividend is sourced from an LIC capital gain.
  • Yearly and half yearly profit announcements, regular shareholder briefings and access to all company announcements, including net asset backing announcements that are intended to keep shareholders informed about the Company's activities and performance.
  • Bruce Teele, Former Chairman, AFIC
  • Geoffrey Driver, General Manager Business Development and Investor Relations
  • Ross Barker, Managing Director, AFIC
Brief Synopsis

Why choose AFIC

GD: AFIC's very much a long term investor. Our investment time frame's five, ten, even twenty years - that's the way we look at providing returns to our shareholders.

GD: Just need to be aware in terms of comparing different vehicles the different tax positions and the different fees that are available. AFIC is an active manage fund. We look very closely at the stocks which go into the portfolio. We're very much a long term investor, so those stocks need to stand the test of time through different business cycles. What you find with something like, this is an example, an exchange trader fund that's made up of all stocks within a particular index so there's no discretion of what stocks are actually in and out of that particular fund, and we've certainly seen over a long period of time returns, or good investor returns, aren't necessarily about the stocks that you own, it's also about the stocks that you decide to preclude from any portfolio.


GD: I think the peace of mind that AFIC provides is that, because we are very much a long term investor, there's quite a long history of performance within the company, there's quite a number of experienced directors and investment managers within the team.

BT: We do have the advantage of long term knowledge, a memory of the market.

BT: If you're trading a portfolio you're going to be constantly paying tax, whereas we hold the shares for the long term so we're not paying tax along the way.

RB: This means that the capital gain that we made on the investments that we've made are at work for the shareholders earning a dividend yield and earning additional capital gain without having, um, that impost of tax.

BT: It's a much more efficient system than a trading fund.

BT: LICs, which have build up some reserves, do have capacity for in the short run to, as it were, subsidize or maintain a dividend.

BT: Many people rely on these companies for their living expenses, so something that's a little bit more certain about the income is very valuable.