Summary: Closed End Fund boosters keep claiming discounts to NTA are opportunities to buy them cheap. The bigger the supposedly-unmerited discount, the bigger the opportunity.

As of 31 Jul 2026, I'll progressively select some of the biggest discounts and disprove this with just one (typically little known) fact for each.

Retail investors are all tied up with so many ASX CEF "opportunities"!

1. MOT: Metrics Income Opportunities Trust
($384m NAV assets; $2.15 NAV;  Price: $1.60; Discount: 26%)

Marketed as blended fixed income with "equity upside." Metrics Credit Partners has actually increased the equity proportion to 40% by using MOT to take on bad loans at 100 cents in the dollar from its other funds. Result: a ridiculous, unchanging "daily-calculated" NAV of $2.15 when a loan goes bad and becomes 2-5% of MOT assets as work-out equity. And investors don't ever get to see these equity positions disclosed!



2. MRE: Metrics Real Estate Multi-Strategy Fund.
($383m NAV assets; $2.53 NAV;  Price: $1.85; Discount: 27%)

MRE's NAV has supposedly been going up but its 50% equity positions aren't being adjusted monthly for adverse conditions affecting Australian residential property. Unlike MOT, at least the quarterly Portfolio Reports (e.g. Mar 2026) provide (albeit 4 month lagged) equity position transparency. But 9% of MRE (18% of equity positions) is in a single greenfield development (Orchard Hills North), not to mention other greenfield development exposure. Adverse monthly marks would appear in the NAV, as they have not, this is a red flag on the accuracy of the MRE NAV.



3. TCF: 360 Capital Mortgage REIT

360 Capital has never transparently disclosed that the majority of its exposure is to a single borrower: Bathla Group. Nor disclosed that, since at least 2025, Bathla Group has been breaching covenants, stopping payments and entering into various loan-default arrangements. Finally, The Australian and AFR are on Bathla's case, and TCF made the below disclosure, but it still doesn't mention Bathla or reveal the true risks entailed:


Troubled developer Bathla Group forced to sell prized sites as lenders circle



4. AFI, ARG, WHF, etc.

For years, the self-serving LIC boosters have claimed discounts are opportunities and highlighted average discounts and cycles in the largest, oldest and most reputable LICs.

See: > Affluence Funds Management: Listed Investment Companies can still deliver for investors


But the old LICs can't just learn new tricks as I explained below. They can't compete with the only game left when you under-perform: artificially-high, fully-franked dividends paid monthly (or at least quarterly).

> Staying ahead of the retiree Income LIC shakeout

> AFI - Australian Foundation Investment Co - Cheat Sheet

(If the above summaries are too long to read or complicated to understand, perhaps that's because LICs are over-complicated, antiquated, pile up legacy issues, and there's only space for performing, income-focused, properly-structured ones to exist.)


Naive, number-crunching analysts think they understand the game, for example, highlighting WHF's dividend predictability:

> Livewire - The LICs offering the most consistent returns and dividends

But for the same reasons I explained with AFI, WHF simply can't run a permanent, artificially-high, fully-franked dividend yield. And nobody wants a (by comparison) predictably low, fully-franked dividend yield.

Whitefield betrayed WHF investors by launching WHI (an artificially-high income focused competitor), rather than first radically-fixing WHF. Hence, WHF investors will continue to dump it and move to WHI, WMX or similar. WHF moving to quarterly dividends can't change that.

There's no reason the other LICs with low, relative dividend yields will suddenly recover. The greater the percentage difference between their Pre-tax and Post-tax NTA, the less likely this is. Expect more competitors, and for the successful artificial-yielding competitors to cannibalise and undermine the existing LICs. The bigger they are, the harder they fall! (More shares need to be sold but these funds can't easily shrink being Closed End and with the tax gap - even AUI merging with DUI didn't result in eliminating the tax penalty).


5. SB2: Salter Brothers Emerging Companies (and other LICs that show no capacity to even match index returns and instead have massively underperformed them)

On 20 Oct 2025 SB2 was trading at 71.5 cents and Wilson Asset Management updated it's tens of thousands of newsletter subscribers on its fabulous discounted LIC strategy run by WAM Strategic Value (WAR). SB2 traded up to 80 cents soon after.

Wilson Asset Management: The Weekly 20 Oct 2025

As of 20 Aug 2026, SB2 is below 60 cents on a ~25% discount. But any intelligent user of my CEF Discount Calculator would estimate a minimum discount for SB2 of over 35% (unless you know SB2 will imminently be put out of its misery). Good luck to those who follow WAM on these LIC dregs adventures. What happened with the several catalysts it saw? Given WAR has reached the 20% accumulation threshold, who are the new buyers for this wealth-destroying fund?

WAR's 5 year and since inception NTA returns are abysmal (less than 4% annualised). Perhaps virtually all discounted LICs are discounted for good reasons and, as these vested-interest dynamics play out, the discounts should only get bigger until the LIC is actually eliminated?