Florin Dolea, the executive manager of CA IB Asset Management, considers the existence of a benchmark index will allow investors to know from the very beginning what they are investing in, as well as to accurately assess fund performances. Premio, the new fund launched by CA IB Asset Management, the investment management arm of HVB Bank, will invest around 45% of assets in stock of financial investment companies (SIF). The remaining 55% of the fund”s assets will account for investments in stock included in the BET index.
“Though it is an actively managed, and not an index-type fund, Premio is the first fund on the Romanian market proposing a combination of stock exchange indexes as a performance measurement standard. Thus, for the first 6 months of activity, this benchmark is 55% represented by the BET index and 45% by the BET-FI. We consider that this approach, which is a common step on mature capital markets, will raise the transparency and professionalism standards on the domestic mutual fund market, with a positive impact on the attractiveness of funds in general,” stated Florin Dolea. Yet, the structure of the fund”s portfolio will not be exclusively made up on the basis of this yardstick, and the fund”s placements may differ in terms of weight in the structure of the benchmark index. Moreover, the manager of the fund does not rule out the possibility of investments being made in stock not included in the BET and BET-FI indexes. These investments may reach a maximum level of 25% of total assets, depending on the fund”s issue prospectus.
“The structure of the portfolio will not coincide with the structure of the benchmark, since the latter is merely a benchmark index on the basis of which customers may be able to assess at any moment the performance of the fund. Thus, in order to evaluate the management of the fund after a certain period, investors will be able to follow the evolution of the BET and BET-FI stock exchange indexes during the respective period. Using a simple calculation, investors will be able to learn the evolution of the benchmark index in comparison with the yield offered by the fund during the respective period,” Dolea explained.
The mutual fund market in late March amounted to 130m euros, 41% higher from the level posted at the beginning of the year.