Content New Europe TOP20 Subfund 1 Russia TOP20 Subfund 2 Global Flexible Subfund 3 Emerging Europe Bond Subfund 4 World Equity Subfund of Funds 5
New Europe TOP20 Subfund Finasta New Europe TOP20 subfund has a concentrated portfolio of 15-25 region s best investment ideas (close to minimum allowed by UCITs). Every pick comes from a thorough fundamental bottom-up analysis. Concentrated portfolio means maximum focus on each investment idea, high leverage on best picks. Higher concentration comes with the risk of higher deviation in subfund s net asset values. Aim of the subfund - to achieve maximum equity return while investing in Eastern Europe ex Russia region. Recommended term of investment - more than 5 years. 110,0 105,0,0 95,0 90,0 85,0 80,0 75,0 70,0 65,0 60,0 Monthly -9,02% YTD 6,85% Since inception -25,67% Subfond data As we forecasted 3 months ago, spring for stock was negative. At the end of February Finasta New Europe TOP20 subfund had a great performance of 16.9% in 2012 but after the correction profit decreased to 6.9% year to date (YTD). On the hand, the fund performed much better than its benchmark CECE Extended that is -3.1% YTD. Most stock had a correction as rising fear of South Europe government debt was followed by controversial elections in several countries. On the other hand, the fund investments are concentrated in those Eastern Europe countries that have much lower debt level than South and Western Europe countries. Companies there are high quality, show strong results and are cheap. P/E of the fund is below 8 compared with historical market level of 12. Despite current negative sentiment, we expect stock to rebound and to have positive finish for the year. 36,179 mln. 10,478 mln. EUR 74,33 Management fee 1,5 % Success fee 15 % Bank of Georgia Holdings PLC Powszechna Kasa Oszczednosci Bank Polski S.A. Bank Pekao SA KGHM Polska Miedz SA Fondul Proprietatea 6,2% 6,9% 7,1% 7,4% Investments by industries Investments by countries Commercial Banks 37,0% Poland 35,0% Oil, Gas & Consumable Fuels 14,7% Austria 15,9% Metals & Mining Romania 11,0% Diversified Financial Services 6,2% Estonia 9,2% Food Products Hotels, Restaurants & Leisure Specialty Retail 5,3% 5,0% 4,6% Georgia Ukraine 7,4% 5,3% Software 4,1% Turkey 3,4% Insurance 3,8% Croatia 3,0% Auto Components 3,4% Bulgaria 1,9% Cash and money market 4,9% Serbia 1,9%
Russia TOP20 subfund Finasta Russia TOP20 subfund has a concentrated portfolio of 15-25 region s best investment ideas (close to minimum allowed by UCITs). Every pick comes from a thorough fundamental bottom-up analysis. Concentrated portfolio means maximum focus on each investment idea, high leverage on best picks. Higher concentration comes with the risk of higher deviation in subfund s net asset values. Aim of the subfund - to achieve maximum equity return while investing in Russia and CIS region. Recommended term of investment - more than 5 years. 105 95 90 85 80 75 70 65 Monthly -15,14% YTD 0,26% Since inception -22,55% Subfond Data Last Spring was rather harsh for Russian equities. European debt crises, decelerating growth in China, political tensions in Russia those factors together caused significant sell-off of stocks. The beginning year gains turned to losses and capital safety dominated any other investment argument. In three months RTS index (in euros) lost 22.6 percent, Russia TOP20 fund fell a bit less - 17.6 percent and its return is +1.3 percent year to date. The fund reduced further the share of resources and increased the weight of companies focused on local consumption. As a result fund volatility is lower and share of companies with high quality management has increased. One of new positions in fund is CTC Media the group of Russian TV channels that is managed by international media holding. This liquid stock stands out for cheap valuation (among peers) and allows a better diversification of fund investments (e.g. less risk). It is likely that high market volatility is there to stay in coming months. However, equities are cheap and further weakness may present good entry point for long term investors. 13,040 mln. 3,777 mln. EUR 77,45 Management fee 1,5 % Success fee 15 % Investments by industries Sberbank M Video Avangardco Investments Public Ltd. - GDR Gazprom GDR Kazmunaigas GDR 7,5% 7,1% 6,1% 5,4% Oil, Gas & Consumable Fuels 33,8% Commercial Banks 19,3% Specialty Retail 7,1% Pharmaceuticals 6,9% Food Products Media 4,5% Metals & Mining 4,1% Cash and money market 8,0%
Global Flexible Subfund Finasta Global Flexible Subfund is considered as actively managed subfund. Subfund investments are diversified and allocated among different regions and assets classes: equity, bonds and other fixed income securities, hedge funds, commodities and currencies. Aim of the subfund - to seek maximum return with risk lower than equity investments. Recommended term of investment - 2-3 years. 105 95 90 85 80 Monthly -4,34% YTD 0,55% Since inception -12,17% Subfund data 2,886 mln. 0,836 mln. EUR 87,83 Management fee 2 % Success fee 15 % Finasta Global Flexible Subfund returned -6.53% during spring. Despite debt restructuring, tensions over Greece s exit from the euro intensified after a struggle to form new government due the indecisive May s parliamentary elections. Indebted Spain and Italy were again under pressure as a result of European politics being slow on reaching agreement to stabilize. Disappointing macro data from US and Asia provided little help too. All this, however, might push central banks to react with the additional accommodative policy at an early date. Euro concerns hit German equities, which declined 8.7% during spring. Commodities were no exception too. ETFs linked to commodity prices tumbled 8% during 3 months. Gold, on the other hand, proved to be a profitable investment contributing a 0.6% profit since its purchase in April. After a prolonged rally equity investments were reduced from 54% to 41% in the end of March. They were bought back in the middle of April. At the same time 9% of the Subfund s was reallocated to: gold (5% exposure) and Bund short ETFs (4%). Vanguard MSCI Emerging Markets ETF DB X-trackers - DAX ETF ishares MSCI Emerging Markets Minimum Volatility Index Fund 7,7% 7,7% 8,3% Fondul Proprietatea 7,6% Elements RICI Total Return ETN 6,8% Investments by asset class Investments by regions Equity 51,0% Alternative investments 48,0% CEE 19,4% Hedge funds and other 28,6% Global emerging 19,1% Commodities 20,2% Europe 7,7% Cash and money market 0,4% Global developed 5,6%
Emerging Europe Bond Subfund Finasta Emerging Europe Bond Subfund invests to the strong credit profile emerging Europe governments and companies debt securities. Subfund Managers combine riskier (corporate) and safer (government) bonds in order to achieve higher total return. Aim of the subfund - to secure the balanced capital growth of the subfund. Recommended term of investment - 1-2 years. 110 108 106 104 102 98 Monthly -0,82% YTD 6,67% Since inception 6,50% Subfund data Weak market sentiment was the main driver of financial during spring. The demand of risky assets decreased, while prices of low or average risk instruments jumped higher. Bond fund unit value have increased by 1,6 percent in spring; and outperformed the benchmark which returned 1,0 percent in three months. During spring the risk of fund was lowered - part of risky corporate bonds were switched to government bonds or short-term bank deposit. In June two Russian companies - Raspadskaya and Novorossiysk Port have redeemed bonds on time. The high level of cash, (it constitute almost 20 percent of funds assets as the end of May), will be decreased with positive market sentiment. The biggest part of cash will be invested in cheap mid-duration (3-5 years) corporate and government bonds. Investments by countries 21,831 mln. 6,323 mln. EUR 106,50 Management fee 1,0 % Russia Romania Lithuania Hungary Croatia Ukraine Kazakhstan 3,2% 5,0% 14,8% 13,1% 12,7% 11,4% 17,7% Cash and money market 17,8% Lithuania 3,75% 2016/02/10 7,8% Vimpelcom 6,493 2016/02/02 7,6% Croatia 6,5% 2015/01/05 6,5% MOL 3,825% 2015/10/05 6,5% City of Bucharest 4,125% 2015/06/22 6,3%
World Equity Subfund of Funds Finasta World Equity Subfund of Funds invest to other funds that invest in global equities. To ensure greater subfund security and diversification, subfund investment strategy is not limited by investment regions or sectors. Aim of the Subfund - seeks higher than average global equity investment return. Recommended term of investment - 3 5 years. 95 90 85 80 75 Monthly -4,39% YTD 1,38% Since inception -14,74% Subfund data Finasta World Equity Subfund of Funds returned -6,04% during spring. Despite debt restructuring, tensions over Greece s exit from the euro intensified after a struggle to form new government due the indecisive May s parliamentary elections. Indebted Spain and Italy were again under pressure as a result of European politics being slow on reaching agreement to stabilize. Disappointing macro data from US and Asia provided little help too. All this, however, might push central banks to react with the additional accommodative policy at an early date. Euro concerns slashed German equities, which suffered a -8.7% loss during spring. Emerging were affected too with ETFs linked to them declining by a total of 1.5%. After a prolonged rally equity investments were reduced from 99% to 84% in the end of March. They were bought back in the middle of April. Investments by regions 1,518 mln. 0,440 mln. EUR 85,26 Management fee 1% Global emerging Global developed North America Europe CEE 1,1% 9,2% 8,3% 23,1% 56,6% Cash and money market 1,8% S&P 500 - A ETF (Amundi) 9,2% Lyxor ETF MSCI Emerging 9,0% ishares MSCI Emerging Markets Minimum Volatility Index Fund 8,9% MSCI World ETF (Lyxor) 8,7% The Lyxor ETF DAX 8,3%