Whitefield & SelfWealth

It’s been an exciting month on the ASX! The boring sideways drift finally got hit by choppy waters, with the first sign of volatility since February. It’s prompted lots of head scratching and fingernail biting from Aussie investors. We didn’t have much cash sitting around, so we didn’t have to think too hard about taking advantage of the dip, but we did manage to shoot off a little bit of dry powder. Time will tell whether it was premature or not.

cake coupleIn October we got our tax return refunds from the ATO, including the franking credits from the past year’s dividends, so we were looking for places to spend it wisely. We only had enough for one bundle of shares, since we never want to spend less than $5000 in one pop to minimise the impact of transaction costs, so we also had to decide whether to buy shares in my name or my wife’s. There are reasons for both: my wife will probably spend some periods of time having babies; and I’ll probably retire earlier than her because I’m a bit older. This time we decided to simplify the decision by putting our next purchase in both of our names jointly.

NAB logoPreviously we were both using NabTrade to buy shares, because it was the cheapest option that we knew about when we started our investing journey a year ago. Thankfully since then I’ve learnt a thing or two mroe about the Australian investing landscape, so we’ve been thinking about switching brokers anyway. SelfWealth currently has the cheapest brokerage on the ASX, at $9.50 per trade, regardless of the size of the trade. With NabTrade we were paying $15 for trades up to $5K, and $20 for trades higher than that. The only reason we hadn’t already pulled the trigger and moved our holdings to new SelfWealth accounts is that SelfWealth is still quite new and untested, despite being fundamentally secure due to being Chess sponsored. (For more info on this, listen to Aussie Firebug’s podcast about it.) So starting a new joint brokerage account was a perfect opportunity for us to try out SelfWealth and save some money in the process.

SelfWealthSetting up the account was an easy process. As a cherry on top, we got 5 free trades for using a referral code when we signed up for SelfWealth. These codes are really easy to find; obviously, everyone wants you to use their codes. If you’re considering starting a SelfWealth trading account, you can get 5 free trades by signing up with this link. If you do that, I’ll get another 5 free trades too, so get on it! *wink wink* With the attached joint cash account, this now brings our collection of bank accounts up to fifteen!

The next step was deciding what to invest in. I already had a short list in mind, including various LICs, ETFs, and whatever category Washington H Soul Pattinson fits into. (Conglomerate?) I’d been looking at BKI, but wasn’t too impressed with its recent capital raising escapades. I’d also been looking at some mid to small cap collections such as QVE and EX20. Plus several of our holdings were looking ripe for top ups during the dip, such as VAS, VGS, and especially VAE which is currently down more than 12% from when we bought it. But finally we settled on Whitefield (ASX:WHF).

Whitefield borderWhitefield is one of the grand old Aussie LICs, but with a particularly industrial focus. In this I mean “industrial” in the Thornhill sense (XJIAI, for acronym loving folks), rather than the more popular sector division sense (GICS); in other words, Whitefield mostly avoids mining and real estate stocks. I find that attractive, after being persuaded by Peter Thornhill’s book Motivated Money, so if you want to know more about that side of things then grab a copy of the book and/or wait for my review of it coming sooner or later. The other things that attracted me to Whitefield were the smooth and steady dividend history and the deep discount to NTA. I also like BSP (DSSP) that Whitefield offers, meaning that my wife and I don’t need to stress about the possibility of one or both us ending up in inefficient tax brackets down the road. (If you’re not familiar with that, check out my article about it.) Plus, I like the fact that it’s dividend calendar is aligned differently from my other big holdings.

The bulk of my portfolio (AFIC, Argo, and Milton) pays dividends in late February or early March, then again in early September. Those periods are really exciting for an income investor, but then there’s not much excitement in the rest of the year. Vanguard pays quarterly, so that spreads things out a bit, but most of our Vanguard holdings are low yielding international ETFs. Watching dividends trickle in provides an important emotional affirmation to the whole income investing approach. It helps us to weather volatility, knowing that even if the market dips we’ll be able to take advantage of it by reinvesting dividends soon… always soon! And of course, one day I hope to be living Soul Pattssolely off the proceeds of the dividends, so having the paychecks spread out around the year would be really handy then. So I like the way Whitefield pays its dividends in June and December, smack in between all of our other dividend dates. This was also one of the main reasons I was considering Soul Patts (ASX:SOL).

Whitefield WWe pulled the trigger on $5000 worth of Whitefield on 24th October at $4.57 per share, which seemed like a nice discount at the time. Then it kept dropping over the next week, so we double-dipped with another $2500 when it was at $4.49. (Thank you, SelfWealth free trades, for making small purchases possible!) Again, we were pretty happy with the discounts we were getting. As of yesterday, Whitefield has recovered to $4.58, so we’re already up slightly, plus there’s a dividend payment only a month away. Winning!

Then last week Whitefield announced their Share Purchase Plan (SPP), at a super low price, so we could have held off on the second purchase and put it there instead. The SPP shares won’t be eligible for the dividend though, so it’s not such a bummer. The SPP will be at $4.31 per share, or a 2.5% discount to the average price for that week, whichever is lower. It seems like an amazing bargain. I was initially hesitant about how the dilution BKI logowill affect the LIC, but it seems negligible, and unlike the recent BKI capital raising, this is only available to existing Whitefield shareholders. Unfortunately I already spent almost all my available funds on the first two batches I bought, but I’ll try to scrounge a few hundred dollars for it if I can.

Disclaimer: Long Whitefield, obviously.  And I stand to gain financially if you use my SelfWealth referral link, so you should totally do that!  Do your own research before investing, etc etc etc.


  1. Hi mate,
    Thanks for the post and for the great blog, I have been enjoying reading it!
    What do you make of the constant discount to NTA of WHF – sure you are getting assets as under the NTA value, but if you were to sell the shares, it would be at under NTA as well, unless things dramatically change in the future.
    Also the SPP – if full subscribed – (big if here admittedly) would dilute by close to 1% , so while not massive, it certainly is not insignificant either, especially if WHF keeps running them SPPs regularly.

    Interested in your thoughts!

    Thanks again!


    1. I’m not bothered by the NTA discount at all, mainly because I don’t intend to sell the shares, ever. I also expect the discount to begin narrowing now the Whitefield are updating their investment methodology.

      To be honest, I’m not really sure whether I like the SPP or not. (Which is a totally different question to whether I’ll buy into it.) Long term I hope that increasing the funds under management will allow them to reduce the fees in line with the dilution.

      Most importantly, I’ll be looking to see whether the dividend yield is diluted. As long as they spend all of the new capital on assets, then the dividend yield should stay strong. That’s the only thing I really care about.


  2. Loved the blog, as I’ve also been considering this LIC. Purchase yield would be greater for you of course. E.g. buying at 5% below NTA means that you get 5% more of the underlying stock for the same price, such that your subsequent dividend yield for the life of the stock will be 5% greater than if purchasing at 0% discount. Kind Regards, Greg


  3. Loved the blog, as I’ve also been considering this LIC. Purchase yield would be greater for you of course. E.g. buying at 5% below NTA means that you get 5% more of the underlying stock for the same price, such that your subsequent dividend yield for the life of the stock will be 5% greater than if purchasing at 0% discount. Kind Regards, Greg


  4. not as enamoured with the SPP this time – poofteenth of a discount and fairly ordinary medium term outlook might make it better to keep the $$$ in the back pocket on this one


    1. Yeah, I’m still tossing up whether to go for it. On the one hand, I’d like to top of WHF anyway, but on the other hand, I might be able to get it cheaper just by biding my time.

      Where’s that crystal ball when I need it?!


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