Djerriwarrh, or Djerri as we call it, is one of the largest income-focussed listed investment companies (LICs) on the ASX. Djerri primarily seeks to provide shareholders with a franked income from Australian equities that is higher than what is available from the S&P/ASX 200 Index, and to deliver this at a low cost.
Djerri also aims to provide shareholders with attractive total investment returns through growth in the capital base over the medium-to-long term.
As well as investing in companies that produce growing dividends, one of the key components in our ability to pay an increased yield is that we use option strategies – predominantly selling call options which gives investors the right to buy a stock at a particular price in the future ‒ to generate extra income.
Our focus is on investing in high quality companies. We want those companies to be able to grow their dividends over the long term, and we aim to buy those companies at a reasonable price.
We assess quality by looking at a range of factors, which include the industry structure, competitive advantage, the quality of management, balance sheet strength, cashflow and ESG considerations.
Then we construct a portfolio to deliver the right mix of income and growth, and we seek to generate additional income from our option-writing activities. Overall, we manage risk by maintaining a diversified portfolio of high quality companies and managing the option positions on a daily basis.
Importantly, our shareholders own the management rights to the company, so there’s no fee leakage to third parties and there’s no performance fees.
Our shareholders also benefit from our full transparency and our high governance standards delivered by an independent Board of Directors.
Djerri is part of the broader group of LICs which includes AFIC, AMCIL and Mirrabooka. This supports a broader research approach and the scale of operations.