There are many listed investment companies (LICs) on the ASX. Most of them are fairly new, but some of them have been around for decades.
Australian United Investment Company Ltd (ASX: AUI) is one of those stalwarts that have been around forever.
History
Australian United was set up in 1953 by Sir Ian Potter and now The Ian Potter Foundation is the company's largest shareholder.
Performance
Australian United's aim isn't about making large short-term returns. Instead, it focuses on creating sustainable long-term returns for its shareholders.
Over the past five years its total shareholder return has been an average of 12.6% per annum.
Holdings
Australian United focuses on the large end of the Australian share market.
Some of its top holdings include Commonwealth Bank of Australia (ASX: CBA), Australia and New Zealand Banking Group (ASX: ANZ), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and Wesfarmers Ltd (ASX: WES).
The main difference between its portfolio and its large-cap focused LIC peers is its 4.5% holding of Diversified United Investment Limited (ASX: DUI). This company has a pretty similar list of holdings to Australian United, except it has a much bigger holding of CSL Limited (ASX: CSL).
Dividends
The best reason for investing in a LIC like Australian United is the dependable and pleasing dividends.
It has maintained or grown its dividend every year since 1992 and currently has a grossed-up dividend yield of 5.86%.
Is it the best?
I think Australian United is one of the very best LICs that focuses on the large end of the Australian market, but I think there are other LICs out there that are better.
I would like to add Australian United to my portfolio at some point but I'll be waiting for a cheaper price before buying, perhaps around $7.
