BKI Investment Co, the ASX-listed fund manager which has made a 10.4 per cent total annual shareholder return over nine years, says its biggest holdings were NAB, Commonwealth Bank and Westpac, as of April 30.
In an ASX statement, BKI says NAB comprised 10.2 per cent of its $700 million investment portfolio, CBA comprised 9.7 per cent of the portfolio and 8.1 per cent was in Westpac stock. Coal miner New Hope Corp was the fourth-biggest stock holding with 7.4 per cent and 6.2 per cent of the portfolio had been invested in BHP shares. About $30 million of the total portfolio was in cash.
BKI says income, dividend yields (franking credits, payout ratios) a company’s business model, a corporation’s debt levels (its management and board) as well earnings and valuations are the main criteria in its stock selection process. The investment portfolio is benchmark “unaware", BKI says.
The company says it does not “churn” stocks. Nor are its fund managers forced to sell during market rises or falls. BKI says the grossed up dividend yield of its portfolio, assuming a tax rate of 30 per cent, was approaching 7 per cent as of December 2012 compared with about 2.5 per cent in December 2003.
BKI says its management expense ratio is 0.18 per cent. It has no performance fees. BKI as of April 30 also had 5.1 per cent of its portfolio in Telstra stocks, 4.6 per cent of it in Wesfarmers shares and 4 per cent in ANZ stock.
Over seven years BKI’s annual return has been 6.1 per cent, over five years 8.1 per cent and over three years 12 per cent. In the 12 months to April BKI’s total return was 29 per cent compared with the 17 per cent gain in the S&P/ASX200 Index,
At close the S&P/ASX200 Index was down 23.599, or 0.47 per cent, to 4959.90.
BKI shares have gained 27 per cent in the last 12 months. The stock today fell 3.5 cents, or 2.3 per cent, to $1.48.