Bonds grab traders attention

The number of bonds listed at Bucharest Stock Exchange (BSE) is increasing at a rapid pace and the raise of the interest rate that issuers are willing to pay to attract cash, combined with a cut in benchmark lending rate by National Bank of Romania has sent bonds back under the spotlight.

If in the early months of the year, bond funds recorded losses or mild increase, since May, their performance improved, and in June, the assets of these collective investment scheme reached 252 mln lei, up 2.6% year-to-date.

5 corporate bonds, 24 municipal bonds and 26 government bonds are listed at the Bucharest Stock Exchange.

8. Stabilo fund 3.92% return

Bond fund Stabilo, under Pioneer Asset Management had a year-to-date return of 3.92%, versus 8.93% increase a year earlier.

The majority of investments are marshaled into municipal and corporate bonds – 48.85%, state securities – 43.94% and 7.37% of the investments go to bank deposits. The net asset value was 8.7 lei according to data from July 10, while fund’s total assets stood at 10.27 million lei.

7. Aviva Investors Tezaur 4.58% return

Aviva Investor Tezaur fund, designed to investors seeking minimum risk exposure, had a year-to-date return of 4.58%. The fund’s NAV is 60.1 and last year, the fund marked an increase in total assets of 9.84%.

The role of the fund is to have a return similar to that of bank deposits, at the same time keeping a maximum liquidity for its investors.

The fund’s investments are mostly in bonds – 49.14% bank deposits and certificates of deposits – 48.33%. 2.24% of the assets are invested in units of other open-end investment funds and 0.29% in current accounts.

6. Vanguard Protector 5.13% return

Vanguard Protector fund managed by Vanguard Asset Management had a year-to-date return of 5.13%.

Bank deposits make up 73.76% of the total assets under fund’s management, followed by municipal and corporate bonds - 26.24%.

The net asset value was 27.44% at July 10 and in the previous week the bond fund recorded a 0.16% increase. In 2008, Vanguard Protector increased by 8.45%.

5. Fortuna Gold 6.33% return

Fortuna Gold fund, managed by Target Assset Management, had a year-to-date return of 6.33%, as last year, the fund’s total assets increased by 5.67%.

Around 80% of the fund’s assets are invested in bank deposits, while bonds account for 18.12% of Fortuna Gold’s portfolio. Moreover, the fund also invests in stocks (1.08%) while the capital available in the current account is 0.58%.

4. Zepter Obligatiuni 7.27% return

Zepter Obligatiuni fund under Zepter Asset Management generated the fourth highest return of all local bond funds – 7.27%.

The net asset value was 10.11 lei on July 10. In the week earlier, Zepter Obligatiuni’s assets increased by 0.19%.

The fund is designed to investors seeking medium to high risk exposure in return of higher-than-average yield and wide-band fluctuations.

3. BCR Obligatiuni- 7.31% return

3. BCR Obligatiuni- 7.31% returnBCR Obligatiuni, administrated by Erste Asset Management reported a 7.31% return year-to-date, and 12.46% increase at end-2008.

The fund recommends to investors to take long position (at least a month).

The highest portion of investments are directed to corporate bonds – 56.93% while bank deposits and municipal bonds account for 24.10%, and 12,44% respectively. State securities account for 6.52% of the fund’s total assets.

2. BT Obligatiuni 8.36%

BT Obligatiuni fund, managed by Banca Transilvania’s asset management unit, generated a 8.36% year-to-date return.

The net asset value is 11.53% and in the week earlier the fund gained 0.26%. According to data available on the fund’s web page, the bank deposits account for 74.42% of total assets, while municipal bonds grab 14.72% share and corporate bonds only 10.83%.

1.Aviva Investors Orizont 8.87% return

Aviva Investors Orizont had the highest return this year, of 8.87%.

In 2008, the fund recorded the highest growth of all bond funds, of 15.11%.

The fund invests 48.60% of the assets in bonds, 30.52% in bank deposits, and certificates of deposits. 11.01% are invested in stocks and 9.49% in other mutual funds.