Status

Monthly overview of the markets of Status New Shares and Status Finance – June 2009

13.07.2009

Status New Shares had a lower growth than the market average mainly due to the more defensive shares in the portfolio of the fund. During the month we continued our strategy for gradual reduction of the share of thee positions in order to make a better use of the uptrend which we expect to remain stable in the next few months. Most markets move within their December-January range, which shows that market participants do not bet on fast economic recovery but rather on avoidance of the worse options for development of the crisis. From than perspective we consider the fast transition to aggressive positions to be rather risky. During the month we increased by a minimal percentage our positions in more aggressive shares in Croatia and Romania. The considerable growth of the Turkish shares during the last few months reduces the potential for a fast growth compared to other markets in southeast Europe. This is the reason why we focused our investments on more liquid markets in the region at the expense of our share in Bulgaria.

After the successful performance of financial shares in March, April and May there was a slow down of growth rates in June. To a great extent the growth of financial companies in the second quarter was due to the pessimistic bias towards the sector in the first quarter. Since the main concerns connected with possible bad scenarios for the development of the global financial infrastructure subsided, the lower risk perception affected bank shares. At present the financial shares trade at levels after the bankruptcy of Lehman Brothers excluding the Turkish banks which in four months managed to erase the losses after the failure of the investment bank and presently trade at levels from the second half of 2008. Thus the substantial increase of the share in Turkish banks in the portfolio of Status Finance turned into a successful move regarding the improvement risk-return ratio.