Debt funds run wild on the ASX as equity funds go friendless
The listed investment fund market is a tale of two asset classes: equity funds are very much out of favour while debt funds are thirsty for income and bringing in money.
It’s a given that at any point, someone smart is telling you that the equity market is dangerously overvalued. But what if you could invest in the Australian sharemarket at a 10 per cent discount to its current value?
Well, guess what? You can. This is not a sales pitch. It’s a description of the state of play in the listed investment company market in which nearly centuries-old share funds are trading on the ASX at substantial discounts to the value of their blue-chip equity portfolios.
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Jonathan Shapiro writes about banking and finance, specialising in hedge funds, corporate debt, private equity and investment banking. He is based in Sydney. Connect with Jonathan on Twitter. Email Jonathan at jonathan.shapiro@afr.com
