Listed investment companies (LICs) are businesses that purely just invest in other stocks for the benefit of shareholders.
Some LICs focus on the large end of the ASX market, some focus on the smaller ASX businesses and some focus on international shares.
Here are three LIC options that cover at least one of those areas:
Clime Capital Limited (ASX: CAM)
Clime is a fairly small LIC that invests in small caps, medium caps and large caps on the ASX. It also invests in stocks listed overseas. This is a very attractive investment style to me as it allows the investment team to choose the best investment for the portfolio no matter where it's listed.
Some of its biggest holdings include National Australia Bank Ltd. (ASX: NAB), Ramsay Health Care Limited (ASX: RHC), Henderson Group plc (ASX: JHG), Gateway Lifestyle Group (ASX: GTY) and Collins Foods Ltd (ASX: CKF).
Clime is currently trading with a grossed-up dividend yield of 7.96%. It pays this out as a quarterly dividend.
MFF Capital Investments Ltd (ASX: MFF)
MFF Capital is a LIC run by Magellan Financial Group Ltd (ASX: MFG). It focuses on the best overseas-listed companies.
Some of its top holdings are Visa, Home Depot, Lowe's and MasterCard. This strategy has worked very well for the business as its average return over the past five years has been 24.1% per annum.
MFF Capital is currently trading with a partially franked yield of 1.03%.
Australian United Investment Company Ltd (ASX: AUI)
Australian United has been operating since the 1950s. It focuses its investments on all the large blue chips of Australia such as Commonwealth Bank of Australia (ASX: CBA), Telstra Corporation Ltd (ASX: TLS), Macquarie Group Ltd (ASX: MQG) and Wesfarmers Ltd (ASX: WES).
It has one of the most impressive dividend histories having maintained or grown its dividend every year for at least the past 25 years.
Australian United is currently trading with a grossed-up dividend yield of 6%.
Foolish takeaway
All three options would make good additions to most portfolios. I think most Australian investors have too little internationally-focused investments, so it would be worth having a look at MFF Capital first.
