Grow your portfolio and help our youth: Future Generation Companies
Today we are joined with a special guest, Louise Walsh. Louise is the CEO of ASX listed companies FGG and FGX (known as the Future Generation Companies). If you haven’t heard of these companies before, they provide a way for you to expand your portfolio, have access to a range of great fund managers and instead of paying the usual 1% fees, this money goes towards a range of charities supporting Australian youth mental health and children at risk.
How did the Future Generation Companies come about?
Both FGG and FGX are listed investment companies (listed on the ASX). FGX is for people interested in investing in shares, FGG is the sister company which is for investors who are interested in investing in global equities. FGX was set up first in 2014, and based on the success, a lot of investors asked for a global equities equivalent. Essentially what they’ve done is gather together a group of best performing Australian fund managers and global fund managers and said to them, ‘you would usually charge a performance fee and management fee, in this case we would like no fees to be charged whatsoever so 1% of the assets can be donated to charity’.
What does this mean from an investors point of view?
From an investors point of view, you can get access to a diverse range of fund managers, some of which are only available to wholesale investors. On top of this, rather than paying performance and management fees, the 1% is donated to charities which focus on Australian youth mental health and children at risk.
Which charities are involved?
FGX supports Australian charities focused on children at risk such as Act for Kids, Kids Helpline, Youth Focus, Variety and more. FGG supports charities focused on young Australians affected by mental illness, including Beyondblue, Headspace, Butterfly and more. These charities have been involved from the beginning, however currently a charity review is being undertaken, as FGG and FGX are committed to making sure the donations are spent well and that they can be trusted by investors. Shareholders actually get a say in the choice as well by having the option to vote every August as to where the 1% should go!
How are the fund managers chosen?
The art of the investment committee is to keep the volatility as low as possible. These companies are fairly conservative and resigned to do well when times are highly volatile (which is happening at the moment).
How does buying and selling work?
There is no minimum so it is very accessible. On top of this, the Future Generation Funds have a partnership with Commsec. Purchasing FGG or FGX shares through Commsec allows your brokerage fee to be rebated. This makes it appealing to younger investors!
The share price of FGG and FGX is fairly steady. Often the ultimate time to buy listed investment companies is when they are trading at a discount to Net Tangible Assets because it means you are getting a bit more of a bargain (you can find the NTA on the Future Generation Funds website as well as the ASX).
We think the Future Generation Companies are an awesome initiative which allows you to make a financial investment and a positive impact on society at the same time. If you haven’t already, take a listen to the podcast recording for more info from Louise herself!
Caitlin and Rachel Treasure