The last trading session is over and it’s time to see our results: +11.94% for the year.
The price of the Fund unit rose 7.9% (historical yield).
Despite some volatility on financial markets, we believe to finish 2018 year with the yield of 10-15%.
We’ve finished 2017 with 10.37% yield (the price of the fund unit rose 10.37% in RUR). For comparison, the base deposits profitability in Russia in the end of the year was 7.794% (in RUR).
At the end of the year the Fund portfolio was mixed by assets of different risk classes and contained:
Equities of the portfolio is well balanced by different industries.
In the 2018 I expect the yield of the Fund will be around 15-20%.
For 9 months of 2017 TNOC unit rose by 13.76%. Mostly all of this movement has got in the 3d quarter of 2017 and is due to operations with equity securities (MICEX: TGKB, DIXY), dividends received (ALRS, GMKN), yield received from fixed income securities (sub-federal and corporate).
Comparable dynamics of TNOC unit, MICEX index, Governement bond and Corporate bond indices with 1-3 years duration.
Source: MICEX , TNOC calculations
According to the investment strategy, the price of the Fund unit will get around 15% for the year.
In the first half of 2017 the Fund unit reaches all-time hight, rose 4.65% year-to-date. This yield supposes annual growth around 10%.
Investment yield was received from coupons, dividends and some speculative transactions with stocks. At June 30th the share of stocks in the portfolio was more than a half — 56%. Another large share is fixed income (36%), and the rest is foreign currency and rubles.
Fund portfolio structure at June 30, 2017
Indicators, % (6 month, Dec 30, 2016 — Jun 30, 2017)
|TNO Capital (unit price, RUR)||4.65%|
|MICEX index (RUR)||-13.1%|
|RTS index (USD)||-15.8%|
|Inflation rate (May 2017, YoY)||4,1%|
In the 1st quarter 2017 the Fund unit rose 1.08%, and this is not bad result comparing with other indicators.
Indicators, % (3 month, Dec 30, 2016 — Mar 31, 2017)
|TNO Capital (unit price, RUR)||1,08%|
|MICEX index (RUR)||-10,61%|
|RTS index (USD)||-3,35%|
|Inflation rate (February 2017, YoY)||4,60%|
We have stable performance in the last three years, so with our investment strategy for 2017 we expect to receive 10-15% of income for the year.
It was a good year for Russian equity market (MICEX +24% YTD), but not so good for forex assets (currency basket decreased more than 18% YTD to Russian ruble). Revaluation of the Fund forex assets causes weak performance of the Fund unit in 2016 (+5% YTD). For example, standard bank deposit (in RUR) in 2016 was able to receive 8.4-10% per annum.
Our long-term strategy for 2017 provides:
Flat portfolio performance is continued as local currency market and stockmarket were traded mostly in flat direction in April-June. From the beginning of the year price unit of the fund rose by 2.5%. The benchmark, Sberbank-Balanced Fund, rose 7.44% at the same period.
Worse-than-benchmark performance is due to the large share of forex assets in the portfolio, so RUR revaluation in June also had some negative effect.