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Fortrend’s mission is to help Australian investors diversify investment portfolios into sectors of the economy not available on the Australian market. The objective is to reduce risk and improve returns.
98% of investment opportunities exist outside Australia. Due to Australian tax incentives, franking credits in particular, the Australian stock market is “Austral Centric”, “Income Focused” and “Protectionist”.
- Austral Centric: Franking Credits encourage Australian companies to earn income in Australia to generate franking credits. Income earned offshore generally does not generate Franking Credits. The effect is that Australian listed companies have become Austral Centric.
- Income Focused: Investors in Australia prefer that Australian listed companies distribute franked income today, rather than invest for growth, which would generate taxable capital gains in the future.
- Protectionist: Foreign investors do not get the benefit of franking credits and are at a competitive disadvantage to Australian investors, particularly superannuation funds which get a rebate for taxes paid at the corporate level.
The net effect is that the Australian market provides very little global growth. For example, in Australia you can not buy shares in global Entertainment (Disney, Sony), Food (Kraft, Nestle), Consumer Products (Unilever, Proctor & Gamble), Software (Microsoft, SAP), Computer (IBM, Dell) or Aerospace (Boeing) companies. |
