Investors guess at the Fed – Finance – Kommersant

Although the last autumn month pleased private investors in the collective investment market, the income was noticeably lower than a month earlier. The best dynamics was shown by funds focused on foreign assets, which rose against the backdrop of reduced fears about a further increase in the Fed’s rate. Funds focused on precious metals also benefited. Outsiders in November were the shares of industry funds focused on the shares of Russian oil and gas companies and consumer sectors.

Overseas settlement

November portfolio managers have worked noticeably worse than October. However, according to the data Investfunds, last month, out of 119 large retail funds (OPIFs and BPIFs with assets over 500 million rubles), 90 funds brought income to shareholders. At the same time, only 13 retail funds had returns above 5%, while the top two funds returned 11% and 13%. A month earlier, the results were higher – every second fund showed double-digit returns, and the top five mutual funds brought returns at the level of 20-24%.

The best returns were provided by funds oriented towards foreign exchange assets. According to Investfunds, the value of shares of funds investing in stocks and ETFs of foreign companies increased by 3-11% over the month.

According to Viktor Bark, Director of the Asset Management Department at Alfa Capital Management Company, the results of the funds simply reflect the dynamics of the stock markets, which looked more calm in November. According to in November, the leading European stock indices rose by 5-8.5%. This was facilitated by data on inflation, which turned out to be lower than expected. “Investors took this as a sign that the need for tighter monetary policy by the Fed and the ECB is reduced,” explains Viktor Bark.

Among the growth leaders were funds investing in precious metals, which provided shareholders with an income of 4.3-6.5%. The best dynamics was demonstrated by mutual funds investing in ETFs (iShares Gold Trust and SPDR Gold Shares). This is due to the fact that gold has risen in price over the past month by more than 8%, to $ 1,773 per troy ounce, the highest since early July.

The bullish game of investors was also facilitated by reduced expectations regarding the pace of the Fed’s rate hike, which affected the decline in US Treasury bond yields.

Last month, the yield on ten-year US Treasuries (UST) fell by 40 basis points to 3.6% per annum. “This trend increases the relative attractiveness of assets that do not bring current income, including gold,” says Vitaly Isakov, investment director at Otkritie Management Company. Partially, the increase in dollar prices for the precious metal was offset by currency revaluation due to the depreciation of the dollar in Russia by 0.8%, to 61 rubles/$.

Raw material did not come out

Funds of the broad Russian stock and bond market, which were among the growth leaders a month earlier, showed weak dynamics. In November, the shares of such funds added up to 1% in price. During the reporting period, the Moscow Exchange index rose by only 0.4%, the RGBITR government bond index added 0.9%, and the RUCBITR corporate bond index — 0.3%. Better than the market showed the result of funds focused on companies in the power industry and metallurgy, whose shares rose in price by 2.7-2.8%.

The outsiders turned out to be sectoral funds focused on companies in the oil and gas and consumer sectors. Such investments depreciated by 1.2–2%. Shares of the oil and gas sector naturally showed weak dynamics against the backdrop of declining oil prices. Brent oil has lost more than 5% in price over the month. “The decline in the oil market was due to fears associated with a slowdown in the global economy amid tightening monetary policies by leading central banks and the introduction of lockdowns in China due to the worsening epidemiological situation. The decline in the global economy may lead to a decrease in demand for the products of Russian exporters,” said Anton Kravchenko, head of the equity department at Pervaya Management Company.

Growth bet

In the coming month, according to portfolio managers, the situation on the Russian market may improve in the event of a Christmas rally on world markets. According to Anton Kravchenko, this may be facilitated by a possible easing of coronavirus restrictions in China, as well as signals from the Fed that the position on monetary policy will be revised towards a less severe tightening. The statistics on inflation and the US labor market can serve as a basis for softening the statements. “Before the end of the year, the Moscow Exchange index may realize an attempt to grow towards the target range of 2250-2300 points,” notes Mr. Kravchenko.

Vitaly Gaidaev

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