U.S. Global Technology and Aerospace & Defense ETF Price & Performance (WAR)

So paying the dividend at the rate we have just paid it we'll be able to continue to pay it at at that rate for the next three years at least. Obviously, the plan from the Board's perspective is to gently increase that dividend and to provide that plus capital growth to shareholders. In terms of where the share price is versus the NTA, that is disappointing from an investor's perspective. Myself being a large investor, I'm sure everyone else here. We believe that we will get WAM strategic value trading at NTA, if not a premium. And also one of our shareholders, a number of years ago asked if they could have the look through NTA and that's the NTA of all the companies we've invested in, what the value of their assets are And that's a lot higher that's around that high $1.4 level. So what I'm going to do today is myself, and Marty McCarthy are here and we're here to answer any questions you have. Also, all the questions you've sent in, we've got April. From our Comms sorry, from our Investor Relations team. There to who will be asking specifically the questions. And we're very happy to go into each individual stock, etcetera, etcetera.

If you look at we have I know there's a few questions that have come in and we'll touch on them specifically. But one question was [indiscernible] I put money in the IPO and I'm disappointed. And I put money in the IPO myself and I'm disappointed. Now why am I disappointed? One is the share price is trading at a discount to NTA. [indiscernible] I know we've had a good well, over the last few years, a good fully franked dividend and this year obviously a a solid fully franked dividend, which is well and significantly higher than what the market are delivering. But in terms of returns, even if the share price was trading at NTA, [indiscernible] the returns haven't been spectacular. They've been reasonable, in terms of the underlying performance of the portfolio. Broadly, the portfolio has performed in line excluding expenses, costs, etcetera. The portfolio has performed in line with the market, which which isn't good enough. Now one of the things that's worthwhile noting is the volatility of the portfolio because we're buying discounted assets then then the volatility of the portfolio has been a lot less in the market. I think market volatility was WAM well over 11%.

And the volatility of the actual underlying portfolio is just a little over 8%. So in theory, volatility is a measure of risk. You're taking less risk and you're getting the same return as the market. As an investor, I'm happy to take less risk and I'd prefer to get a better return in the market. Or even take a little bit more risking still get a better return than the market. In terms of what we've been doing, buying those discount asset plays, that will continue to happen. One of our goals for this next twelve months is to get that the share price trading at NTA, if not a premium. And we think we'll get that from performance. [indiscernible] and also the ability to keep growing our dividend. In terms of performance so far this year and particularly in the last few weeks, or since the February, the market's off a little bit. And [indiscernible] we've just been a little bit the portfolio has held up better than the market. Since in this little last little period where the markets been a bit soft. Why don't I leave it there and pass over to April who will take us through the questions.

And Mady and myself are obviously available to answer them.

So some of you sent in questions beforehand that will go through. And as Jeff said, please ask any questions that you'd like through the Q and A chat. Function. Before I begin, please make sure that read the disclaimer on the screen. So the first question is for Marty and it's from Greg. Can you please touch on some of the top portfolio contributors such as QVE and Yeah, of course. Thanks, April. And the on both of those, let me start with QV equities. It's an investment that has the thesis has played out for us. We were accumulating QV equities at about a 10% discount to NAV on average. And through that investment, we've got market performance plus the closing of that discount. As QV equities went into a scheme of arrangement with WAM leaders. At the point of the scheme of arrangement, there was a cash out option and also a script option. We took the cash out option there. So took the cash out and then we have redeployed that into new opportunities. One of those opportunities that you mentioned in the question was as a position where we have been able to accumulate stock at a 25% to 30% discount to NTA.

The NTA performance has been strong over the last twelve months. With their investment portfolio. And we've seen a small narrowing of that discount as well. Look, I think to be give credit to the team at SB2, it's Brothers. They're doing a lot of work to change their shareholder register. The register was historically and the product was designed for investor visas. So a lot of offshore initially offshore investors. And they are looking to over time change that register composition. With marketing. More recently, we have announced an inaugural dividend for the company, which I think will be well received by the market. And one of the catalysts that we see for that discount narrowing further. So it's one that we've been opportunistic with and we'll continue to pick up stock. As that discount blows out.

Thanks, Marty. The next question comes from David, who's asked, given the ever deepening breakdown of governance in The USA, what are your thoughts on the effects on the on WAM managed shares?

Well, that's a big question. In terms of what we're seeing at the moment from a market's perspective, the equity market in The U. S. Had performed extremely well. And the various policies and strategies that Trump had really foreshadowed before he won presidency. Even after he won presidency, people are aware of that. The sort of the concern well, not the the part that's probably shaken the market a little bit more is the fact that he had some policies that would be negative for the economy. That he was going to implement and he had some policies that would be positive for the economy. He's going to implement. What he's done to date and I know it's only been a little under two months, has tended to be the negative policies, the ones in terms of increasing tariffs, which is inflationary, reducing costs in the public service, which obviously is negative for the economy, people lose jobs. And but some of the more positive ones in terms of for economic for the economy is cutting tax rates. On the corporates, which is again promised. But there's been no real discussion or sign of that. So the I think some of the excesses have been taken out of the market.

In terms of our abilities what we're looking for Warr is to buy assets at a discount. If this shakeout puts any additional pressure on some of those companies that are trading at discounts, they get a bigger discounts and this sometimes happens. What you tend to find is in the early part of when the market there's a bit of a market shakeout, you'll find that the discounts to NTA actually narrow. Because the well, the share price holds up If it is a discount, the share price holds up. A little bit more than you expect. So we're well positioned there. It shouldn't what we do in Moore is very [indiscernible] [indiscernible] very systematic. Obviously, [indiscernible] in terms of the impact that the market has on what we do, obviously, it does have an impact. We're buying undervalued assets. And if those undervalued assets decline in value because the equity market falls, then that'll have a negative impact. Or more. This current shakeout we don't expect that the big risk in The U. S. Is it turns into a recession. The market's forecasting a recession. What we think is now that's not the case. This this point in time.

What the market's doing is just forecast it's just saying, look, it was a bit overextended on the upside. And it's just I don't like the words, but people use sort of healthy profit taking. Obviously, when everyone's losing money, it doesn't feel healthy at all. But taking some of the excesses out of the market. Is good for the markets long term.

Thanks, Jeff. The next question, we've actually got a few on corporate activity. This one comes from Joe, who's asked, are there any updates [indiscernible] Both these Regal LIKs have been trading sideways to down recently. Saba has recently sold down VG1 and is no longer a substantial holder. Will WAM become more active in VG1 to push for the discount to close? [indiscernible] VG1 and RG8, I think one is at about an 8% discount, the other about a 12% discount. I mean, we have been trading the discounts We like Sabah with VG1 selling a few shares because the discount had narrowed significantly. You must cast your mind back a year or two ago, they were trading at 18% to 20% discounts. So the discounts have come in both the VG1 and the RG8. They have capital management programs. And we think what they need to do is they're not only have those capital management programs, but also they have to have a really good shareholder engagement WAM comms program. We think like so we've got eight listed investment companies five of them traded either NTA or premiums. And three of them are discounts. And of the discounts WAM is one of them.

And it tends to be the most recent three are the ones trading at discounts. And that gives you a little bit of a hint of of what needs to be done is the shareholder bases have to be aligned with what the individual company is trying to do. And that everyone who's a shareholder is is understands what the company is trying to do. And so then you don't have the selling pressure and then you need to get more buyers. Now with with WAM, we were trading at a bigger discount The discount has come in and actually it come in quite a bit I think at the end of the last half, it's actually drifted out a little bit more. So we've got to do some more work in terms of telling the story and so people understand that buying with war, I think at the moment you're buying $1 of assets and you're paying $0.88 or something like that. So with in terms of being more active from our perspective, [indiscernible] in terms of we communicate with Regal, They know what's required to do. It needs to be done and they are doing it. Whether they achieve it trading at NTA or a premium, They've been able to do that with the other listed investment company.

So to me, we think they can do it with this. And I suppose while I've learned in investing, patience is very important. And I think what has happened at WAM is a lot of the investors that invested in War don't realize that our strategies take time to play out. There's no use for us being an activist for RG8 or VG1, I mean, we'd have to use how to become an activist. We communicate with the company. We could use one of our vehicles to bid if it might sense. But it's got to make sense. And we've got to be able to continue to pay fully franked dividends and growing ones in the vehicle we use. There are a number of factors. And Saba hasn't sold out totally. They've just They're just not a substantial shareholder anymore. So they've gone under the 5%. So they probably got 4.5%.

Thanks, Jeff. Joe also has some follow-up questions in relation to this. Will war push for corporate activity to either combine the two licks VG1 and RG8 to increase liquidity and reduce admin costs There's another one that I'll ask in a minute, but maybe we'll start with that.

Well, that's an option they've got. But the interesting thing is they've also got the PM Capital LIC and that's actually made a bid for the platinum LIC [indiscernible] So there was a scenario where maybe RG8 could have been merged with [indiscernible] PM Capital LIC, which is trying to get a premium or VG1 could have merged with them or as you said, the two could be merged together. Yes, so to me, it's I don't necessarily think merging the two together if they're both trading around that 8% to 12% discount, whether that will [indiscernible] significantly Obviously merging with something trying to get NTA, if not a premium, allows everyone to have an arbitrage opportunity. So that's more interesting. From our perspective.

Well, you've already answered Joe's follow-up question which is on PM Cap capital. The next question comes from David which is on the share price. We have a few on the share price. David's asked with WAM not matching the ASX 300, what do the directors intend to do? There seems to be little pressure put on any of the funds to return to net tangible assets.

You might think there's little pressure put on, but we look at them on a daily basis consistently. And that's I mean we've been able to grow our business by making sure our listed investment companies reflect their true value over time. And as I mentioned, of our eight listed investment companies, five of them are trading at NTA, if not premiums. And the more three more recent ones trading at discounts. And the good thing is we understand why there are discounts is because it takes time to tighten up the share register. And once you get that share register tight, then you don't need much buying for the share price to fully reflect the NTA. I mean, if you look at Warr as an example, say the NTA is well the last month's the end of Feb stated NTA was $1.29 dollars and we said to look through NTA was 1.49 So you'd assume that over time, that the NTA should trade between that $1.29 and the $1.49 because $1.49 is actually for all the companies we invested in, you know, we're training at MTA, then that's the value you'd get. So I mean, we it's a constant it's a constant concern for us.

We're constantly aware from it. About it. We have thirteen, fourteen people in shelter engagement and comms. And if you have any ideas or thoughts, please come through to them with them. We're confident that the three LOCs that that we manage that are trading at discounts will trade at NTA, if not premiums. The problem is I can't tell you exactly when. And if we don't get the WAM Global, April, can you ask me about WAM Global a little later about and premium and discounts? Because that's like a pointing case. Thanks.

Will do. Thanks Jeff. The next question comes from Derek and it's also on the share price. He's wondering is part of the problem WAM practice of amortizing dividends instead of distributing profits when they earned. Perhaps as other leagues have done WAM could be converted into an open ended fund?

I got two parts of the question there. I'll do the second part first. We could We could turn it into an open ended fund. And that I mean, what that would do would for the people that well, we could turn it if we turned it an open end fund then it would be a more of a trust structure. And then that changes the whole tax dynamics. For the investor base. So that could be the case. And then people would have an then to get out of or if they wanted to sell, then they could redeem at NTA. For all those people that didn't want to sell, it would change their tax base, but also it would take away from them the ability to sell at a premium. And as I mentioned, of our effectively of our eight LOCs, one is trading around NTA and four of them are trading at premiums. And the premiums I think the highest premium April, what's the highest premium at the moment? Is it about a 9% premium for one of them? I think?

I think global is about that now.

Global WAM a discount, but no one of them I think in micro is trading at about 8% or 9% premium. So and those premiums can go to we've seen them think the most extreme premium was WAM Research, which got to a 50 something percent premium NTA. So if you turn it to me, it's sort of like two sides of the coin. If you turn it into a trust structure and allow trades at NTA, then you'll never get the benefit of something trading at a premium. And we've shown over time that we can that our listed investment companies do trade at premiums. And when do they trade at premiums? It's when the share register has tightened up. And And people are prepared to pay above what the value of the assets are worth. To me, [indiscernible] a pretty simple story in terms of, as I mentioned, dollars 1.29 of real assets, look through value of 1.49 at the end of last month. So where should they be trading? Maybe in between the two. So I wouldn't want to leave before that happens. And if we turned into a trust, then the best case you'd get is $1.29 and dollars and you'd actually lose some franking credits because of what the government bought in terms of tax changes.

About a year ago. The first part of the question, what was that? I've just I've answered the second part. What was the first part?

The first part was one moment.

Sorry.

We are also sorry, I've just lost it. We also have a question from Gap Gary actually, which is in relation to WAM Global, which you alluded to, Jeff. Gary has asked how many shares does WAM Strategic Value own in WAM Global? And what price will WAM Strategic Value exit that company?

Do we have the first part of that last question? Well, if you look that up while I answer this. Hey, Marty, how many shares is it exactly? Can you look that up? Yes, of course. And we'll give you the exact number of shares. And but the more interesting question is when we sell them. And I think was talking about WAM Global a bit earlier. WAM Global is is one of the three LICs that we have is currently trading at discounts discount NTA and it's the larger of the three. So we've been working on shareholder engagement, communications, strategies. It was go back a year and a bit ago, it was trading at about I think 15% to 18% discount. We had a detailed shareholder engagement communication strategy six months ago. That discount came in again. And then we had another Shell engagement communication strategy more recently and that discount came in about a I think it was trading at about a 5.5% discount at some point in time. What you've got to remember is listed investment companies, it's a simple first year economics when they teach about supply and demand. And NTA is equilibrium. So if you have more supply and less demand, then you trade below equilibrium or NTA.

If you have more demand and less supply, then you move back up to NTA. If you have still more demand and less supply, then you trade at a premium NTA. So it's really that's what we spend a lot of time on from our perspective and making investors understand what they've invested in, because if and all the investors that are on the call are shareholders. If you're not interested in a company that's that's what our mandate is, is buying assets at a discount. And so we're trying to get the exposure to those assets and the uplift of the discount. And I think a few people have been concerned that we haven't we haven't done more in terms of the activism side of things. It takes time for all those things to play out. I think we've been involved in four or five or even six corporate takeovers or corporate actions, which is probably more than most other participants. But as Marty talked about say we've been buying shares in Salter Brothers at like a 30% discount at 28% discount NTA. And we've gone from owning none to are we up to 11% or 1211%, yes.

Yes. So it just takes time It just takes time to build a position and you want to build a position at the price you want to buy things at. So you need to have patience. So if you're not looking for that and then so we're giving you the exposure [indiscernible] and we believe that the ones that we invest in will eventually trade at value of the assets. So we'll be able to sell But back on WAM Global, we've been able to get that to more recently. It did come into less than a 6% discount. The discount has drifted a little bit now. With a bit of volatility. In the market. But back to answer your question is, when are we going to sell it? First of all, we made a mistake with the takeover. When Temple and when the sorry, when WAM Global bid for Templeens, we took shares because it was 6% we're 6% better off. In hindsight, not because we should have we should have taken the cash [indiscernible] a, it would have freed up the cash B, we wouldn't have to keep talking about each result. And C, we don't we don't we don't get a management fee on that part of the portfolio.

So for all those reasons, and it would have given us cash to do various other things potentially. But our plan would be our plan is to sell down and we'll decide when that is when it's the right time. Obviously, if it WAM trying to get NTA for if not a premium, then we'd be on the selling side. Like we if we can find other investment opportunities at a bigger discount, then maybe we sell some at a discount. If we don't think in the short term it's going to trade at NTA or even excluding don't think in the short term going to trade at NTA. If we can find something that's trading at a bigger discount, then we're actually we're switching a smaller discount for a bigger discount, which is better for shareholders. So [indiscernible] these are all our options. [indiscernible] Hi, Paul. I think I've lost you.

But yes, circling back Derek's question, he the first part of it was whether part of the problem of WAM share price might be the practice of amortizing dividends instead of distributing profits when they're earned?

Just on that the with our profit reserve, that is the change in the value, the realized and unrealized change in the value of the assets. So a lot of that profit reserve isn't realized. So in terms of our ability to pay dividends, what history shows that that investors prefer consistent growing stream of fully franked dividends. Not like a high dividend and a low dividend and then a high dividend and a low dividend. So yes, so that strategy doesn't really work. Listed investment companies. It might work with trusts. We actually distribute 100% of what they've realized But companies, that's a beautiful thing about the listed investment companies, they don't have to do Thanks, Jeff. And we've got a question from Samuel. He says, has asked Platinum Capital, PMC and Platinum Asia, PAI are subject to take offers from another lick. Are you able to rule out accepting the scrip offers for them so as to avoid getting into the same mess that happened when Templeton was taken over.

Yes. Well, for me that's not necessarily the same case Samuel. I mean, we'll look at each each on its own merits. So WAM Wham Capital made a bid for West Oz, and Ozgrave. We actually accepted script because it wasn't a cash alternative and then we sold the WAM Capital script. So it will take a number of factors into consideration The price [indiscernible] and the liquidity of the underlying business that we're investing in. So the PM capital the liquidity of that company. So if you had to ask us now, we'd probably be more inclined for the cash. When we get there, we'll [indiscernible] we'll make a logical consideration, accepting that sometimes people take cash and then they sell the shares afterwards. So trying to work out the impact we think that will have on the underlying value of the bidding company. If assuming the bids go go ahead.

We've got a question from Roger. NAYOS Small Cap Opportunities Company was once a lick that you liked. What are your thoughts now?

Yeah, incredibly disappointing performance. Yes, I mean, we like the discount. Unfortunately, the underlying manager has performed poorly. It's a very small percentage of our [indiscernible] I'm just trying to think it's about one in the one less than 1.5% of the portfolio. It's yes, it's really disappointed. Really disappointed. So I'm not that excited about it.

Thanks, Jeff. We've got a question from Steve. This might be more for WAM leaders and WAM Capital, but do you have a view on A2 Milk? [indiscernible] [indiscernible] and the guys, April will come back to you, Steve. And tell you guys.

Yeah. I'll reach out Steve. Thank you. We've got a question from Rodney. Jeff, which stock in the portfolio is most misunderstood by the market that you WAM most excited about?

Rodney, good question. Wouldn't want to tell you because that's the one we're buying. That's the problem. I don't want everyone to buy it because in the opportunity evaporates. Yeah. Sorry about that, Rodney.

In six months' time, ask that question again. And say six months ago, I asked you, which was that stock and I'll tell you. The thing is, the tough thing is the liquidity in some of these companies, it does take time to build positions. And you have to be patient. If you want to build a position at the right price. So yes.

Thanks, Jeff. Another follow-up from Rodney, which you have touched on a little bit before, but why should you stay in a closed end fund?

Well, I actually think closed end funds well, one of the holy grails of closed end funds is the fact that they can trade at discounts to NTA and they can trade at premiums. So to me, it's nearly unbelievable that you can get exposure to all these underlying fund managers. Effectively $1.49 of assets you're paying [indiscernible] one zero dollars sorry, dollars $1.12 1.13 dollars one point one four dollars [indiscernible] And then obviously you're going to assess whether you believe that one day that those assets will be fully reflected of the market value. And we've got enormous confidence that will be the case. So to me, the listed investment company or the closed end pool of capital is a great pool of capital. A, for a fund manager because they can take a long term view and they don't get caught with money running coming in and money coming out. Like if you had an open end of fund at the moment, I was looking at the numbers of the money that's flying out of the open ended funds in The U. S. Like there's trillions of dollars I know maybe it's not trillions. I know the markets lost $4,500,000,000,000 but maybe it's billions of dollars that have come out of the market Yes, since its peak number of weeks ago.

So then if we had an open end of fund, and then you have redemptions, then you're forced selling. So you're selling companies that you think are cheap. As an investor, that's like to me, that's very it's a very it's frustrating behavior as an investor because you want to be buying companies that are cheap, not selling them. Them.

Thanks, Jeff. We've got a question from James. How do unlisted assets impact your investment approach?

Yeah. Unlisted assets not really much at all. Only occasionally some of the underlying funds or underlying companies we invest in we'll invest in unlisted assets. And then we make an assessment of the value of those unlisted assets. When we're trying to work out what we believe the value of the assets of the underlying company is. And we usually put a if they're unlisted, we usually because if we don't know the assets well, then we'll put a little bit of a discount from our perspective. But on the other side, you could know the assets well and they might be worth more than what they're in the books at Usually that's not the case, but occasionally it can be.

Thanks, Jeff. And we've got a question from Paul. Can you please update us on the government's plan to impose a 30% tax on superannuation balances over 3,000,000?

Pounds Update you. Okay. So it looks like we're having an election in May. Sometime The current government was looking at increasing the tax from 15% to 30% on balances over $3,000,000 And we didn't we didn't have strong view on that. One thing that both governments need to do is they need to fix the tax system. To me, it's it's very it's not an equitable system. Particularly for younger Australians. So work has to be done on that. What we were concerned about is the fact that the government wanted to allow the taxing of unrealized gains and that they only came out with that because their initial policy was to not tax only a tax on realized gains for [indiscernible] But because the big industry and union funds couldn't work out what that was on a per client basis. They said they can only work it out on a unrealized gains basis. So therefore, the government said, I'll look, we'll tax unrealized gains. And that's just like it's just bad policy. You've got people that have relied on this system to [indiscernible] to buy assets and then all of a sudden might be unlisted assets and they're going to be taxed on the change in the value which is which they have no liquidity.

And some farmers will be caught with it. One of our shareholders is a farmer outside of a rural city. He nearly went under during the GFC. He got his banks wanted the money back. He sold half his farm, put the other half his farm in his super fund because he didn't want to ever be in that position again. He's quite elderly. And now that if this comes in the tax on unrealized gains, he'll have to sell the other half his farm just to pay the tax because the gain hasn't been realized. It's just just bad policy and also people are concerned that it might end up becoming they might bring in tax on unrealized gains in other areas, which is just discourages people investing. What we want is a tax system that's fair, that treats younger people fairly and encourages younger people to to work and get ahead. Because we all know there's it's a pretty tough environment out there, particularly in the housing market. [indiscernible] where we've had housing inflation for last twenty five years running double the rate of normal inflation. So every year, your chance of buying a house unfortunately goes back goes against you?

So anyway, that's I'm off topic there.

No, it's a big topic. I've got two questions for Marty. Rodney has asked what is the cash limit of the fund once proceeds from Australian Unity Office Fund and Global Data Center come in? Do you need to deploy that capital back into markets? Or can you be patient?

Thanks, April and Rodney. Look, we can be patient. We've got no limits in the fund. We've got a very flexible mandate. On the cash, we have in the past held high levels of cash. Financial year to date, we've averaged around 17% cash. Obviously, at the February, it was a little bit lower. It has, through the month of March, you'll see it has dialed up So live, we're sitting around 11% cash. Obviously, GDC is about 4% of the portfolio. AOF is 5%. So when those two come back, through, we'd be sitting on a healthy cash balance. And those two are effectively cash boxes as we stand today. With the proceeds from GDC coming in and AOF, hopefully, by the end of this financial year largely paid back to us. So gives us a little bit of protection in the portfolio and a bit of a buffer from the volatility we're seeing at the moment. Given they are quasi cash positions already.

Thanks, Marty. The next question comes from Rob. What is the logic to invest and hold in Lark Distilling as it's not a list investment company?

Yeah. And look and that one was one that sits in the discount asset sleeve of our portfolio. So the thesis there was that Lark was trading at a discount to its whiskey under maturation. And that they would be a way for the company to unlock that value. Obviously, the share price has performed as we would have hoped it to. And the company still trading at a discount to its asset backing, being that property with the whiskey barrels and maturity under maturity. So one that's a small position of the portfolio that we continue to hold. There was a change twelve, eighteen months ago with the management team there. They have signed a number of strategic partnerships into the Asian market. To look to turn over that Whiskey Bank and increase cash flow and generate returns for investors. So expect that one to be cash flow positive. In the next eighteen, twenty four months. I hope that's hopefully that's reflected in the share price. And we're not thinking about it as an asset play as we are at the moment. And more a company that's more trading like an operating business would. So still believe that there's value from that transaction for investors.

Thanks, Mady. The next question comes from Brian and is for Jeff. Which industry sectors are likely to be the growth areas for the year ahead?

Hi, Brian. It's a good question. I think it'll be a tough year ahead. There's the market had performed pretty strongly. We've got the adjustment in The U. S. Obviously, the adjustment globally with what Trump's various plans are. There's no doubt I'm not sure how whether you've read or how old you are, but back when the Berlin Wall came down, there was a big growth dividend globally because people had to spend less money on on protecting themselves. [indiscernible] it's actually nearly the reverse of the growth [indiscernible] of that that growth dividend. So the uncertainty that Trump's creating globally and particularly with Europe just increases the cost of all those countries cost in terms of spending for defense. And that's got to come from somewhere. It comes from higher taxes or which is negative. For the economy. So I think it's going to be a challenging year. That's sort of that's my view. In terms of any individual sector, I'd probably defer to whether it's Matt, or Oscar or Katrina, the lead PMs for the various other companies. They'll have all their strategies Obviously, technology [indiscernible] even though there's that's been overhyped there's still significant wealth that's going to be created.

Through the utilization of smart technologies, etcetera. So, yeah, the thing is the good thing is I'm more we don't have to worry about that that much. We just need to find a company that's trading at a discount asset. And then understand how it'll trade it though at NTA again. And if we believe it will, then and we can see a catalyst can do that, then we buy it.

Thanks, Jeff. And while we're on that topic, Rodney has asked the S and P five hundred is down 10% from its peak and the NASDAQ is down 14%. [indiscernible] Are we in a broader bear market? And how do you position to come out the other side?

The we're not on the bear market yet. Because [indiscernible] then we'll enter the bear market. I mean, what we do know is markets go up and down. And so [indiscernible] don't want to get too concerned about a market falling because the challenge is how quickly you make the money back. In terms of how we're positioned, I know we mentioned earlier on the call is we're holding a bit of cash already. About a little under 12% cash. And then also when AOF turns into cash and global data centers when we get the rest of our money for that. Then that gives us quite a bit of flexibility in terms of cash levels would be at a reasonable level. Broadly, what you WAM to do is broad like what I've sort of what I've discovered over time is in I was a lot younger, I sort of focused on market timing a lot more. And as I've seen more market cycles and probably the inability to to pick the tops and bottoms of markets, I've realized it's it's really time in the market rather than timing of the market. And a nice statistic is over the last twenty years, I think if you missed the best performing day each year, that's twenty days over twenty years, but the best performing day [indiscernible] Your return as an investor in the market would be close to zero.

If you were in the market and got all those, the best performing twenty days over the twenty years, then your performance is close to 8% to 10%. So yes, to me, it's I mean, we will we will increase our cash levels, but broadly we'll be invested. And we'll draw them down when we can see good opportunities.

Thanks, Jeff. We've got a question from Paul. Why the sudden drop in thorny opportunities?

Yes. Marty, have you got a strong view on that?

Not a strong view. So obviously, I had a really strong performance from a share price perspective last year. I think it was up over 40%. Through the last financial year. I think share price up until close of business last night was down about 11% in this There'll have been a little bit of NTA decline there and a little bit of widening of the disc [indiscernible] today, but it was about 35% discount at the end of last financial year. So yes, I'd say just a bit of a correction after the the strong share price performance over the last financial year.

Yes. And also what you tend to find is sometimes because there'll be there can easily be periods where there's just a lack of liquidity when the markets a bit volatile. There could be a lack of buying and then if there's a seller then all of a sudden they push the price down quite a bit. Particularly in periods where there's quite a where there's a bit of Thanks, Jeff and Marty. We've got a question from Graham for Jeff. He says, is getting worried about the number of new funds and Jeff seems to be phasing himself out in terms of the seminars. Is this a reason for the various share price declines?

Well, first of all, the share price haven't declined. [indiscernible] Particularly since we've announced our results. And secondly, I suppose one thing that people have got to realize is I think we're what are we are we up to 70 people? Do you know how many? Do you know how many employees who are up? Five, I think.

Yes, 65 employees. On the investing side, we've nearly got seventeen twenty, twenty investing professionals, which have have significant experience. And in terms of managing the portfolios, they have been managing the portfolios. I can go on all the webinars but there's there's no value maybe on the webinars I'm just sort of there as the as the figurehead where in WAM, Marty, myself and Jesse, we manage the portfolio to be here. Yes. So does that pretty does that answer the question, April? Was there any part of the question I missed?

No, I think you covered it off. Thanks, Jeff. We've got a question from Trent that I think for Marty. Can and I think Jeff has already touched on a little bit before, but can you please speak to the amount of cash that's currently held in WAM portfolio and where you see this level sitting?

Yeah. And just to reiterate what I said earlier, I think at the February, we were 7%, 8% cash. AOF, which is one of our discount assets, has announced a special dividend late last month, which has gone ex this month. And will be paid in the coming days. So that's cash receivable for the Fund. And that takes us to a little over 11%. When you add in AOF and GDC. We're getting closer to 20% given they have both sold their underlying investments. Are just waiting for the settlement of those investments to return capital to shareholders. So as I said earlier, sitting with a a bit of dry powder in the portfolio, obviously protecting us from some of the volatility at the moment. And gives us the opportunity to selectively deploy that capital and opportunities as we do see discounts widen. Through this period of volatility.

Marty, we've had a few questions and we've touched on them before. One question is from Ian on Warhead Holdings in Platinum and Platinum Asia Investments at the February. Will more be supporting the PGF alternative?

Yes. And I think Jeff touched on it earlier.

Is that yes, we will be? Or No, no. I was more just I'll take the question since there was a silence. Look, I think it's fluid, the situation. Think when they came out with the announcement, it was there were reporting a 6% premium to the cash out option because of the share price premium of PGF. We've got relatively small holdings there, but as Jeff said earlier, they are consideration would be given to the premium of the stock option versus the cash option at the time of conversion. The liquidity of PGF being the acquirer and an assessment on what we think the potential flowback might be from platinum investors who want to exit on market. Obviously, as we saw with Templeton, the larger the premium they are, probably the more unnatural holders take the script option.

Which causes undue pressure on the they acquire a share price post transaction. So a few moving parts. I think Jeff said earlier as well, given where the dynamic is live today, we'd probably be inclined to take cash over script. So that's where our heads are at the moment. But watching it if the transaction goes ahead, watching where the dynamics will end. Closer to the endpoint.

Thanks, Marty. Ian has asked, Glenon is trading at a 35% discount to NTA. Why doesn't someone buy it like Wham's strategic value?

Very good point. Very good point. The tough thing is when it was when it [indiscernible] is before we had WAM strategic values set up, I personally put some money in at a dollar And so I've I've got a reasonable position in the company Obviously, I'm not that pleased it's trading at a big discount. And Samuel something will work out eventually [indiscernible] it would be to me, it's just too much of a conflict of interest if as I have a position then WAM builds a position in Glenon as well.

Thanks, Jeff. And on this topic, Trent is asked about WAM Global actually. How do you protect against internal biases and interest on this investment?

Yes. Well, I mean, that's I suppose it's like you just got to be aware of that. We're managing the portfolio as if we're managing the portfolio. Our view was when it was trading at a sort of that 18%, 20% discount, it was too big a discount. So we didn't sell any then. And I mentioned well, it would actually be in our interest if we didn't own any shares. Because we'd get paid a management fee on [indiscernible] used for. We currently don't get that anymore. But just like there's nothing to me, there's nothing wrong with having conflicts of interest. It's just you got to be aware of the and you've got to act independently. And that's what we focus on. And also, it's there's nothing wrong with having inside information because we're given inside information all the time by companies. The only thing that's wrong is if you trade on it. Then you go to jail. So, yes, again, with conflicts of interest, we're aware of them. And we'll do what as the portfolio managers of Wall, we'll do what is in Warr's best interest.

And maybe just following on from that, Jeff, it's just one of the questions that was asked earlier was our holding in WAM Global. And I don't think we came back to it. So we're a little over 18,000,000 about 5.1% of the company.

So Aileen point one? 18,400,000.0 shares. 24,000,000.

Okay.

A little over 5.1% of the company. And I think if we look at WAM Global, it has been a really strong performer for us, and particularly over the last two years. Obviously, it went from a premium to a discount at the time we we went into the Templeton transaction. And we've talked to some of the dynamics there in relation to platinum. And potential for selling pressure. The investment team there have delivered plus 20% performance over the last two calendar years. And we have seen that discount narrow, as Jeff said, from that 18% to live around about 9%. From our portfolio perspective, it is delivering a really healthy fully franked income as well. Which is allowing us to pass that fully franked income through to to our investor base. So not one that we want to hold forever, As we as the discount narrows, we'll look to to opportunistically sell that one down as Jeff has said.

Thank you. The next question comes from Andrew. He says MFF Capital Investments is still trading at a 1010% discount. Is there any interest?

It's probably not a big enough discount for us. We were an MFF when it was a bigger discount. And then we're in the other Magellan funds. And then we actually switched out of MFF into the other Magellan funds because we thought it was more likely that they would do something in terms of capital management, which they ended up doing. If MFF was a 20% discount, then it would be more interesting from our perspective.

Thanks, Jeff. We've got a question on Steven and he says you've touched on this at the start of the webinar, Jeff. However, can you please explain the investment rationale for continuing to hold a substantial holding in the NAYOS small cap opportunities company.

Yeah, well, I didn't I probably didn't really touch on why we're shareholders. In terms of [indiscernible] yes, it currently makes up I think 1.47% of the portfolio. And the way that NAYOS performed, which has been incredibly We think there could easily be like something has to happen I don't think NIOS can continue as they have been. Because the performance has been [indiscernible] disappointing. If we can get out at NTA, then then we're very interested in and we can move on to something else. So, yes, the performance has been disappointing.

Thanks, Jeff. And we've got a question from and this is for Marty. What is the latest on Cambridge? Is Bolton any closer to jail? He says he was a Keybridge shareholder until Bolton blew it up. [indiscernible] To me, I think the key bridge you guys listened to or listened. We put this on our website. So actually, we're currently in court And actually, I think we're waiting for a judgment So it's probably sorry, we take your question [indiscernible] hear your question and hear your comments. It's probably best if we don't. What are we doing? Well, actually, do we earn any in think we hundred dollars worth in more.

That's all we can see on that one.

It's not relevant to war, yes.

The next question comes from Graham Could you advise which companies are trading at NTA or a premium? [indiscernible] now, Graeme, of our listed investment companies?

I assume that's what Graeme means. Yeah.

Yeah, yeah, yeah. Marty, have you got the figure there or Yes, it was one capital one Active, one Research, one Microcap and one Leaders is our NTA. Of our stable WAM Microcap is the largest premium in the stable at the moment, around about that 8% to 9%. Obviously, markets are moving around a little bit, so bit of volatility there. But the other three are at a low single digit premium and leaders is kind of oscillating between a very small discount and small premium. So it's there or thereabouts.

Thank you. The next question is for Jeff and it comes from Kieran. The government's proposed changes to the super legislation was narrowly not passed, which you touched on earlier. But specifically, what are your views on the market environment if unrealized gains are taxable?

Well, initially, it's only unrealized gains in super funds and it's people that have more than $3,000,000 So it really will impact our small business and farmers mainly. One of the negatives we see is it sort of takes people's aspirations away. And the real risk is if it spreads out from there. Because you want to encourage people to invest risk capital to try to get returns. If you want to look at an example of what's happened globally in Norway, they bought in taxes on unrealized gains, but at a higher level. Not in super funds, but just just taxes and And I think half of the richest people in Norway and I think their first unicorn, like a technology guy, they've all left. They've gone to domicile themselves somewhere else. Because they they get negatively impacted. And taxing unrealized gains, if it was broadly the tax on unrealized gains, why would you if you're a young entrepreneur set up a technology company, [indiscernible] you could be losing money for years, but the value of your business might go up a lot. And then you got to pay tax on something that may never eventually, that you may never get that value.

So to me, it's not a great It's not a great. Tax.

Thanks, Jeff. We've got a question for Marty from Andre. Do you own Morphic Ethical Equities Fund?

We don't within the WAM strategic value portfolio. So MEC, I think, discounts around about 10%, 12% at the moment. And we do, however, have a holding in Future Generation Global, FGG, investing committee of FGG. At a point in time, we were invested in the unlisted version. Of the Morphic Ethical Fund. We were increasing our investment and there was a line of stock in the LIC at a discount. So we took the the stock at a discount. And the plan was to arb that out as it went back to NTA parity. Unfortunately, that hasn't occurred. More recently, we have been accumulating or FGG has been accumulating stock and changed substantial recently. The company is going through a bit of capital management initiatives at the moment. So it does have a kind of capital management strategy at play. Discounts come in. But again, just with potential perceived conflicts of interest, we haven't muddied the waters and acquired it in WAM as well as having a hold in future generation global. So we've tried to keep those two separate.

Thanks, Marni. Trent has asked direct discount assets like Lark and DAS make up only a small part of the fund. Can you share your thoughts on these investments and their role in the strategy moving forward acknowledging we did touch on Lark a little bit earlier? Yes.

And the I mean global data centers, you could argue that's that sort of that was more an operating business that we put in there and we ended up making very good money on. AMP, we've had that at various points in time and made some good money on it. Effectively, what we've focused on is buying assets at a discount. So there are various periods of time in a cycle where operating businesses will get sold down and trade below the value of their assets. And so even though our main focus is on the closed end fund sector, there's 80 odd companies in that. And there's more listing [indiscernible] We'll look at that and we'll look at also REITs that are trading at discounts, but we've got to be confident as we've got AOF effectively WAM a REIT trading at a discount. We could see a clear catalyst that the money that they were going to to sell all the assets and give the money back. So it's really trying to find those companies that are trading at discounts. And as you said, like the Lark one, it's a minuscule position is it?

It less than a percent of the portfolio or point a lack of 0.5% of the portfolio. Literally and Dusk 0.3%. Again, DUSK was a discounted value asset play which we've been letting some rallied strongly since the price we bought it at and we've been selling some.

So yes, so to me, it's again, that they well, they could be a big part of portfolio, just depends what value say all the banks traded 30% or 40% discount to the NTA, They're not at the moment. Com Bank is trading at 350% premium or 300% premium. But it could be there can be opportunities where operating businesses trade at big discounts to NTIs. So there's there's opportunities there. And then the best one for us was Global Data, Centers, which we made really good money on.

We've got a question from Gary. WAM Global recently announced an increased dividend and a special dividend. Regal Asian Investments and VGI Partners Global Investments have increased their dividends from $0.05 to $0.06 we hold these companies to collect dividends?

We can, but that's not our main focus. That's sort of the side benefit Our main focus is getting as close to MTA as we can buying at a discount and selling close to NTA. And making profit that way. But the secondary benefit is getting some very nice fully franked dividends.

Thanks, Jeff. And we've got a question from Angus, which is also for you, Jeff. I see you WAM starting a lick with monthly dividends. Any chance of WAM strategic value paying Actually, yes. And we had on our slides today, I think is it the second last slide? We talked about yes, WAM Income Maximizer, WMX, which we lodged the prospectus for about a week ago. That is pretty much interesting you say that the reason we've created this new company and I think someone asked a question earlier on about are you doing all these new companies? The reason we created this was because probably for the last five to ten years, people have been asking us can you pay more regular dividends? With the LIC structure as it is, historically, we've paid monthly dividends. People have said, look, will you pay quarterly dividends? And we haven't been that keen And over the over the journey, everyone's a lot of people have been saying, can you pay monthly dividends? We did survey at the end of last year just asking people about dividends. They said yes, we would I think 63% of the people that responded said they'd like monthly dividends.

So we hear clearly what you want probably for the last four years Now we've been looking at creating a product that can do that. And we started with a blank piece of paper that is a product that can give you the maximum return with the minimum risk. And that's why we're wealth income maximizer comes from. [indiscernible] entitlement. So if you want to apply for shares, then you can go on to our website and apply for shares We've put $180,000,000 worth of stock aside for all the WAM entity, our one hundred and thirty odd shareholders. And yes, and so this one will give you monthly income. And we're specifically created this and it's it's broadly 60% equities, large caps, and 40% debt. But it's high quality it's high quality debt investment grade debt and high quality equities. And so we'll use our traditional way of investing in both equities and debt to get the best returns for shareholders over time. So this will be our monthly income product, the plan is it'll be really interesting to see how this goes. Because [indiscernible] [indiscernible] there are other monthly income products listed There's a couple which try to premium consistent premiums to NTA.

I think there is something people as you quite rightly pointed out do want more regular income. Historically, we've held off But this depending on how this goes, this may change our view. Terms of how we pay the dividend. So I won't say we'll never [indiscernible] But the plan isn't in the short term.

We've got a question from Laurence. Laurence has asked which current holding you already have built a good position in are you most positive about and why? [indiscernible] this is the easy one is AOF because we're getting our money back. It's just annualized. What annualized return is it at the moment Marty?

If we get the full proceeds that we expect, it's 4% return, about 13% annualized return. [indiscernible] Yes. So that's incredible confidence with that one. [indiscernible] Yes, actually, we're still buying one of them. I'm pretty confident in [indiscernible] To me one of the interesting ones is Carlton Investments. It's just interesting because it's a very big discount. I can't see a short term catalyst. We've got a very small position like it's 2% of the portfolio. But something at some point in time will happen there. Marty, is there any others you're I assume you thought of that, but more just Which one? Are we still buying it?

No, more perpetual pick. This one we've traded exceptionally well is that this [indiscernible] someone was asking the question there about you know, public publicly us being active and whether through the media shareholder meetings, I think perpetual and PEC is one that we played behind the scenes very well. We bought that one as the discounts approach 10%. And we've been able to dispose of it as the discounts narrowed or is traded at a premium. So it has been one that's been very cyclical, that share price premium. Obviously, Perpetual is going through a bit of a corporate restructure at the moment. Their only equity listed investment company that they've got. And it's just about 10% of our portfolio at the moment, again, as we've been able to buy it at a big discount [indiscernible] either naturally or unnaturally, I think that one will close at some point. So I'd be confident in that one, wouldn't you, Jeff?

Yeah. I think it's pretty fair.

Pretty fair assessment.

Thanks both. We've got a question from Greg. He's asked, Cadence Capital and Cadence Opportunities Fund have traded traded up assistant discounts to the NTA. Would you consider including these links in the WAM strategic value portfolio?

Yeah. It's a bit tricky with [indiscernible] Carl worked with us for a while and we helped him set up Cadence Capital the first LIC. So we've got a conflict of interest there. We actually get a very small part of the management fee there. So that would be yes, like that wouldn't be fair on you guys. So and then the other one, the opportunities fund, that's the second one he did. Which is not very liquid. And to me that could be interesting. It could be interesting.

Thanks, Jeff. We've got a question for Marty from George. You still invested in the U. S. Masters Residential Property Fund? George said he notices that global value fund recently purchased more units in URF and is wondering what your view is?

Yes. So it's actually one that we've disposed off more recently. And the share price had a really strong rally at the start of the financial year. Share price got up to $0.415 which was significantly ahead of our cost price. And we took some profits from that one. NT at the moment is mid €0.6 and there was a few risks that we could see with that one. I think on paper, it looks like a really solid discount. Obviously, they're going through the wind down, and they did come up with positive news from a tax perspective. The portfolio is levered. So there's debt in the portfolio, high interest costs. Obviously, interest rates have gone up a lot. So as they renew that debt facility, it'll increase operating costs there. While they have exited investments at close to book value, There is a 6% selling fee in The U. S. And because of the leverage in the portfolio, And then just a view on The U. S. Property market. We did a bit of analysis on the investments that they hold. Relatively concentrated areas as they do go through the disposal. There might be there's a small risk that we kind of flood the market from.

A supply perspective, which will push down prices. And then I kind of view that potentially they've been selling the better assets and kind of hold on to the rump of the carcass, for want of a better term. So look, not saying we wouldn't hold it again, but at kind of low 40s, we were happy to take the capital off the table there. And if the share price goes down, great. Otherwise, there's plenty of opportunities at the moment that we can that capital elsewhere.

Thanks, Mardi. We've got a question from both David and George. Do you hold WCM at global growth and what is your outlook for the company?

Happy for me to go there, Jeff?

Yeah, yeah, yeah, yeah, Marty happy. No worries. So look, again, it was just a discount to NTA. The WCM guys do have really strong long term performance. Jeff and I have followed them pretty closely from Future Generation Global perspective. They're one of the managers in Future Generation Global. So we followed them and their performance for a long time. They've got quite a unique investment philosophy. Focused around the culture of the business that they invest in. And that has delivered strong performance over time. Performance more recently, they went through a challenging period of performance. And then sentiment bled into the share price, so that kind of supply demand imbalance. Provided us an opportunity to pick some up. So it's not a big position in the portfolio. However, it was one that opportunistically we were able to pick up at a discount. We think the investment team can deliver. They have over a long period of time. And hopefully, we can get back on the back of strong performance. The market will appreciate that and it will trade closer to NTA. Which point we'll be happily happy to exit.

With NTA uplift and that share price narrowing and kind of compounding our return, hopefully.

Thanks. Marty. Another question for you from George. At last week's webinar, Oscar and Tobias said they've been buying A and P, which is trading at a discount to NTA. Is this a company that WAM strategic value would consider investing in?

Yes. I think Jeff touched on the and one we made a fair bit of money out in that discount asset perspective. Back in late 'twenty two, early 'twenty three. I think we're buying it at close to $1 and sold it twice at close to $1.3 as the share price went through that. A bit of volatility, and they had some extensive capital management. So definitely one that's always on our radar given we've had a positive experience with it. And obviously leverage the benefit of the wider WAM investment team with Oscar Tobias and their team's views on the stock. So one that we are monitoring along with the other team at the moment.

Thanks, Marty. I've got a question from Derek for Jeff. In answers to several questions, you've mentioned waiting for the register to tighten up. What do you mean by that?

So effectively it's I mean, effectively the drivers for a listed investment company trade it to NTA or a premium is when there's enough buyers at NTA or a premium NTA. And what you find is what tends to happen is when a share price trades at a discount, [indiscernible] then people are selling because they're selling like why would you sell now when you know the NTAs $1.29 Why would you sell at $1.14 dollars below what it's worth. So it's effectively excess supply And what I mean by tighten up is that excess supply reduces. So effectively, people are selling at discount, you've got excess supply, eventually you don't have any excess supply. And the NTI the number of sellers disappear and so there's less selling. And then you just need the same amount of buying or a bit more buying. And the share price moves from the discount to trade at NTA and if not a premium. So tighten up means reduction in sellers and then eventually increase in buyers.

Thanks, Jeff. We've got a question from Jim who has asked, why has the fund performed poorly and what were the original investments sorry, were the original investments wrong?

Well, first of all, no, I don't think original investments were wrong. And on a risk adjusted basis, you could argue that the funds performed reasonably well From my perspective, WAM a large shareholder like I suppose you're all shareholders because you're on the call. And sorry, back on the volatility of the markets, 11 and a bit percent over the period of time the funds been running. And the fund volatility is only 8%. So you'd assume what that means is you're taking less risk. We've taken less risk investing in the fund. And we've actually excluding our costs, which you can't, but excluding costs we've performed over that period of time in line with the market. Now so to me is like that is that's that's disappointing. And what could we do differently Our strategy has been buying the discounted asset plays The problem is it just takes time for them to be realized. What could have we done differently? Maybe we could have well, first of all, we could have accepted cash for WAM Global. Then we wouldn't be talking about WAM Global. We probably could have had bigger positions well, if we had bigger positions in the in the positions in the companies that were bid for or like the Magellan we had positions in both the Magellan funds We had positions in West Oz and Oz Growth that got bid for.

We had positions in what was that one in Melbourne, AEF?

Yes, AEG.

AEG, sorry. What was that called? The old anyway, another another listed investment company that WAM WAM taken over. So yes, if we'd had bigger positions in those and probably smaller positions in [indiscernible] smaller positions in any of them that went there. [indiscernible] that's what could have been done differently. Would have What have the performance been exceptionally different? It would have been well, if we had bigger positions in the winners and smaller positions in the losers, it actually would have been better. [indiscernible] What have the portfolio increased 50%? No. This is This is you're buying assets at a discount. Like this is a medium term play where you're trying to do the market plus the discount because the underlying [indiscernible] perform in line with the market. And your discount is where you make the profit.

And I think Jeff, as you said, that's all with the benefit of hindsight. And as I look back kind of maybe some missed opportunities that we've had, And again, with the benefit of hindsight is probably the income, the fixed income set. [indiscernible] KKC, Neuberger, Berman, you know, two or three or two out of three of them have closed shop. And the third one, the discounts narrowed materially. We did a fair bit of work on them at the time. Just couldn't get comfort around the risk that investors were taking to get the yield. So while there was a good discount on offer and on paper, they looked like great opportunities, It's how confident we were that we're going to get that capital back. That the discount wasn't going to be eroded by loss of value through the underlying investments. So I think all of that is with the benefit of hindsight. But you can't get it right all the time.

Thanks, Jeff. Thanks, Marty. And Marty, while I've got you, I've got a question from Dennis. With the market correction, stock volatility and many licks trading at a discount to NTA, you see this as a golden opportunity to invest? [indiscernible] with it opportunity. Are what we're seeing at the moment, and I think Jeff touched on it earlier, what you tend to see in initial periods of volatility is the registers of LICs are a little bit slower to react. So while there's some big discounts on offer at the moment, those discounts have narrowed a little bit over the last couple of days. So live discounts aren't as attractive as they were. For us, you kind of want get a bit comfort that the market is in continuing to fall. Don't want to try and catch a falling knife. So obviously, we want the opportunity the volatility to shake out a little bit. Registers to settle. And I think there will, at that point, be lots of opportunities for us.

As we've already said, our cash is relatively healthy. We've got a couple of assets that are going to return cash in the next couple of months. So we're in a good position to take advantage of those opportunities. Once the volatility has died down. And things have shaken out a little bit.

Thanks, Marty. And George has asked you, Marty, what is maximum percentage holding a stock that you can have in the portfolio?

Yeah. So there is no hard limits under the prospectus. We've got a a flexible mandate to allow the investment manager to express their best ideas. Within the prospectus, we did say it would be formally reviewed of position was in excess of 20% of the portfolio. So that formal review process would be with Jeff as the lead portfolio manager and the rest of the board. We don't have to necessarily sell. If we do breach that soft 20% limit. Risk return we were taking and the concentration we were taking in the portfolio. There is no hard limits.

Thanks, Mardi. We have a few questions for Jeff. We've got a question from Nava who's asked, why not keep stocks that pay dividends? Jeff said that doesn't align with the strategy of buying at a discount to NTA. A stock provides strong cash flow through dividends, isn't that achieving the same goal over time? Am I misunderstanding WAM strategy?

No. But the what we're focusing on mainly is capital risk Say we buy a stock at a dollar and it pays good dividends and the stock falls from $1 to $0.5 then you wouldn't be very happy with us. So if we can buy the stock at a dollar it stays at $1 and it has asset, well, we'd hope it goes from $1 to $1.2 1.3 or $1.1 and we get a dividend as well. So WAR strategy is buying undervalued assets. And paying you fully franked dividends from the capital we make and the tax we pay. Along the way, we get fully franked dividends from the companies we invest in. So you're close to the right track. What else was the No, I think that covers it up just in terms of the strategy. So it's good. We've got a question from George and Todd. Can you comment on CD1, CD2 and CD3, they're the CD equity funds.

Yes, big discounts and we at various points in time we buy them and we think at some point in time we'll get close to our the money back. Highly illiquid, so we can't get much in the way of positions.

Thanks, Jeff. And it looks like this is our last question that we've got from Irene. Are monthly dividends good for growth? I'm assuming she's referring to the WAM income [indiscernible] Yes. The WAM income maximizer, we we specifically put that together So the income the dividends and the debt that we invest in in Income Maximizer, that will cover the dividends. So it really depends how the underlying assets perform after that. Whether we get the capital growth or not.

Thanks, Jeff. And we've had one more sneak in from Jim, the last question. You had a look at Pacific Current?

Pacific Current is really interesting. Yes. We've got a really small position there. The discount just isn't big enough. And the interesting thing is the Chairman who I spoke to recently, he accepted the recent buyback. So and they're saying the last three funds they've got, even though it's trading at about a 17% discount NTA after the buyback, I think they're saying that the last three fund managers, they don't expect to sell them in the foreseeable future. So you just can't see the catalyst. And to me, I think the Chairman accepting the buyback was sort of indicating what his view is.

Thanks, Jeff. Thanks, Marty. And thanks to everyone for submitting your questions. This now closes the Q and A component of the webinar. If we're unable to get to any of your questions today, we'll definitely contact you afterwards. I'll now pass over to Jeff for closing remarks.

Yes. Look, thanks April and thanks Marty and thanks for all the shareholders engagement. Again, this is it was a very high quality level of questions and along webinar. So this is your company and we're managing it on your behalf.

Please our plan is to have the share price trading at NTA, if not a premium. Over the medium term. And if you do have any questions or comments, please come back to us. Thank you very much.