Eastern European Fund – May 2011

Looking at the performance of the Nevsky Capital Eastern European Fund during April 2011, it can be seen that it once again managed to out-perform the overall GEM index during the month.

Indeed, taking the month as a whole, the fund rose by a total of 4.1% (in US$ terms). This compares to a 3.8% rise in the MSCI Emerging European Index.

Looking at specific markets, it can be seen that performance was particularly strong in Hungary, Poland and the Czech Republic. These 3 markets were able to benefit from the strength of the Euro, resulting in rises of 10-12%. The fund was well positioned to take advantage of this situation, with particularly strong selections in both Hungary and Poland.

The Russian market remained broadly flat, despite the continued strength of oil prices. Gazprom continued to perform well, but Nevsky Capital have reduced their Russian weighting since the end of April.

Looking at the overall make-up of the fund, the geographic allocation in April 2011 was:

  • Russia: 61.6%
  • Poland: 11.3%
  • Hungary: 10.4%
  • Turkey: 8.8%
  • Czech Republic: 3.7%
  • Kazakhstan: 1.7%

The remainder is currently held in cash.

By sector, it can be seen that the fund is comprised of 29.5% Energy and 28.3% Financials. Other sectors represented include Materials and Telecommunications.