Mirrabooka is a listed investment company specialising in investing in small and medium sized companies located within Australia and New Zealand. Our general definition of small and medium sized companies is those companies which fall outside the top 50 listed companies, by market capitalisation, on the Australian Stock Exchange (ASX).
There are many small and medium size companies listed on the ASX and we seek to invest in those companies which we believe offer investors attractive value. Of particular interest are companies with relatively low price earnings ratios and high dividend yields. Often these companies have strong growth prospects and specialise in a range of attractive product, market and industry sectors. Benefits may also arise from takeover and/or merger activity.
The Company has been operating since April 1999 and was listed on the ASX on 28 June 2001.
Investment Aims
The Company aims to provide medium to long term investment gains through holding core investments in selected small and medium sized companies and to provide attractive dividend returns to shareholders from these investments.
Approach to Investing
Investing in this sector can be subject to greater volatility compared with investing in larger capitalised companies because of the reliance these smaller companies have on single markets, products and/or key individuals. From time to time, shares in these smaller companies may also be subject to lower than normal liquidity. Consequently, this section of the market requires a significant amount of research and subsequent close monitoring of the portfolio.
In this context, we are willing to move quickly to realise investments when we form a view that an investment is well overvalued or there has been a material adverse change in a company’s circumstances or prospects. As such, we believe it is important to be nimble and responsive to material changes affecting these investments.
The Company typically holds between 50 - 80 stocks depending on their fit with our investment aims and the desired concentration of risk within the portfolio.
The Company also has access to lines of credit which allows the Company on a limited basis to gear its balance sheet when appropriate investment returns are available. In addition, the Company also uses options written against its portfolio to generate additional income although this activity is naturally limited by the lack of availability of option markets for most of the shares within the portfolio and the need to control our investments for risk management purposes.