Friday, January 12, 2007

AFI has had a good run....

The Australian Foundation Investment Company Limited (ASX:AFI) currently has an equities portfolio worth nearly $A5 billion. The group has approximately $A3.5 billion invested in blue-chip companies such as BHP Billiton, Brambles and Coles. AFI has achieved a total portfolio return of 15.2 per cent over the last 10 years, compared with 13.1 per cent for the S&P/ASX 200.

The group recorded a 23.5 per cent net profit rise for the 12 months to 30 June 2006, but it has warned that investors should not expect a repeat of the growth recorded by the Australian stock market in 2006.

When a company starts to get this big it has problems managing its funds. It was able to achieve the growth because of its size compared to other fund managers. It is now starting to get to the case where it is going to have returns similar to the market.

Still an impressive performance.

Good Luck Investing.

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