The Australian Foundation Investment Co Ltd (ASX: AFI) has long held a reputation for being a Listed Investment Company (LIC) that primarily invests in blue chip ASX shares. That's what you get when you've been around since 1928 and don't change your investing playbook too often.
But it seems as though even an old ship can still change course.
Don't worry, there's nothing too radical here. AFIC's largest positions remain in ASX 200 blue chip shares, according to its latest data. Its top shares still include stalwarts like Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP) and CSL Limited (ASX: CSL).
However, there have been rumours swirling around that AFIC has been looking beyond our shores for its investment horizon. These largely stem from AFIC's annual general meeting last year.
Well, we just got some proof that the rumours were not entirely unfounded. AFIC has just released its annual report for the 2021 financial year and it contained some very interesting tidbits. AFIC actually announced that it has been investing beyond the ASX in a meaningful way. Here's what it said:
A small part of our funds, $48 million (which represents approximately 0.5 per cent of the portfolio) was invested into a diversified global equities portfolio during the latter half of the financial year.
Not only that, but AFIC also disclosed these international shares. And it turns out there are quite a lot of them: 39 in fact.
AFIC takes the plunge on US tech stocks
These companies are mostly US shares, but there are some British, German Fench, Swiss and Chinese companies too. We won't go through all of them, but here are some of the more prominent names:
- Apple Inc (NASDAQ: AAPL)
- Alphabet Inc Class A (NASDAQ: GOOGL)
- Facebook Inc (NASDAQ: FB)
- Amazon.com Inc (NASDAQ: AMZN)
- Mastercard Inc (NYSE: MA)
- McDonald's Corp (NYSE: MCD)
- Microsoft Corporation (NASDAQ: MSFT)
- PayPal Holdings Inc (NASDAQ: PYPL)
- Netflix Inc (NASDAQ: NFLX)
- Starbucks Corporation (NASDAQ: SBUX)
- Visa Inc (NYSE: V)
- PepsiCo Inc (NASDAQ: PEP)
- Alibaba Group Holding Ltd (HKG: 9988)
- Unilever plc (LSE: ULVR)
- Nestle SA (SWZ: NESN)
So it's pretty evident that AFIC is very happy to add some big US blue chip companies to its portfolio, including all of the FAANG stocks, as well as Microsoft. Its exposure to the European consumer staples giants in Nestle and Unilever is also notable, as is its investment in the Chinese e-commerce giant Alibaba.
And although AFIC admits these positions amount to a relatively small proportion of its overall investments, we can probably expect the company to continue to beef up its international portfolio going forward.
At the current AFIC share price of $8.41, this LIC has a market capitalisation of $10.3 billion, and a dividend yield of 2.84%.
