Australian Foundation Investment Co.Ltd. (ASX: AFI) is Australia’s largest listed investment company (LIC) with a market capitalisation of $6.2 billion.

There are a number of appealing attributes about AFIC which have attracted a loyal, long-term shareholder base. For example, the LIC has a long history of operating profitably and paying fully franked dividends, its management expense ratio is a tiny 0.16%, and over the past 10 years the total shareholder return has outperformed its benchmark.

Given the group’s historic operating performance it’s always interesting to review any recent changes made to its portfolio. Here are four smaller stock positions it recently added to.

Macquarie Group Ltd (ASX: MQG) – AFIC is no doubt attracted to the favourable long term dynamics of Macquarie’s business model along with the undemanding trailing price-to-earnings ratio of 13.1x.

ASX Ltd (ASX: ASX) – As the gatekeeper of the Australian Securities Exchange the ASX offers appealing attributes including competitive advantages as the incumbent provider. Despite the better than average attributes of the ASX, the stock only trades on a market multiple. (Source: CommSec)

Healthscope Ltd (ASX: HSO) – Arguably one of the most attractive investment thematics is the rising demand for healthcare services as a result of an aging population. Healthscope is ideally positioned to benefit from this tailwind.

Sydney Airport Holdings Ltd (ASX: SYD) – As Sydney’s only major airport this company enjoys a monopoly-like position. With the group also having first right of refusal on a planned second airport, the long term potential for the company to remain the dominant provider in Australia’s most populous city looks likely.

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Motley Fool contributor Tim McArthur has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.