The ASX dividend stock PM Capital Global Opportunities Fund Ltd (ASX: PGF) may not be one of the most famous names for passive income, but I'd say the business can provide investors with large and reliable payouts.
I believe listed investment companies (LICs) are an underrated source of dividends because of how they can give investors both diversification and exposure to resilient and growing dividends.
LICs make profits by investing in other shares. They can then use some of that profit to fund the growing dividend payments to shareholders. Strong years can help fund payouts in weaker years.
I think there are three great reasons to choose this ASX dividend stock.
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Compelling investment strategy
The ASX share market is a good place to invest, but it only represents around 2% of the global share market. There are many opportunities outside Australia to choose from, but it can be hard to know where to invest.
Why not let a high-performing investment team make the decisions?
Almost all of the LIC's portfolio is invested in shares outside of Australia, namely Europe and North America. Some of the sectors it's currently invested in include European banks, industrial metals, healthcare, industrials, USA banks, consumer staples, leisure and entertainment, and housing-related investments in Ireland and Spain.
As you can see, it's not reliant on tech for the returns, yet the returns have been very good. Over the past 10 years, the net tangible assets (NTA) return has been an average of 19.9% per year.
That level of portfolio return has allowed the business to deliver very pleasing passive income.
Large dividend yield
Dividends are not guaranteed, though the ASX dividend stock has built up a sizeable profit reserve to fund future dividends.
The last two dividends by the business came to 13 cents per share. At the time of writing, that translates into a grossed-up dividend yield of 5.75%, including franking credits.
That may not be the biggest dividend yield on the ASX, but the size of the payout increases more than makes up for it, in my view. The FY26 interim dividend was hiked by 27%, year over year.
Resilient payouts
A large dividend yield may appeal, but it's not as attractive if the payout isn't likely to be repeated in the following year. The LIC has a great track record of hiking its dividends.
In the FY26 half-year result, the company said that it had retained earnings and profit reserves of $584 million, enough to maintain its dividend for nine years.
The business started paying a dividend a decade ago and has increased it every year in that time aside from FY23 when the payout was maintained.
I expect the business will increase its payout in FY27 and beyond, which is why it's such an appealing ASX dividend stock.
If someone invested $1,000, they'd be able to buy 311 shares of the LIC at the time of writing.
