Ivolga Capital company blog | A brief overview of the PRObonds portfolios. Yields 12.3-13.9% per annum, new changes in bond positions and willingness to hedge

The current profitability of PRObonds portfolios (for the last 365 days): 13.9% for portfolio # 1 and 12.3% for portfolio # 2.

Target returns for the coming year are 12% for portfolio # 1, 15% for portfolio # 2. In case of unfavorable events for portfolios, the most likely minimum annual return for them is 9% per annum.

I think, as in 2018-20, we will avoid default risks. But market risk becomes more likely. This is not a risk of economic shocks similar to last year. If the global and Russian economies even remain in recession, this is a working environment for maintaining portfolio returns.

The main risk for our investments, as I see it, is the decline in stock markets, the general rise in bond yields and the global acceleration of inflation. I think that by the middle of the first quarter these pressure factors will be sufficiently formed.

If last year the portfolios, already excluding personal income tax, outstripped official inflation by 6-7.5%, then this year they can only compensate for it.
A brief overview of the PRObonds portfolios. Yields 12.3-13.9% per annum, new changes in bond positions and willingness to hedge
Bond changes. Next week, new issue bonds of Obuv Rossii will be added to the portfolios (benchmarks of the main parameters: 1.5 billion rubles, coupon 11%, maturity 4 years). Since we do not plan to reduce the share of money in portfolios, a number of positions will partially leave the portfolios for a new acquisition. Fixation falls on issues that either have significantly risen in price since the placement, or are in the process of amortization. In both cases, the potential for a decrease in the future yields of the same securities for portfolios is accumulating. The balance of money in portfolio # 1 will increase slightly, in portfolio # 2 it will remain the same.
A brief overview of the PRObonds portfolios. Yields 12.3-13.9% per annum, new changes in bond positions and willingness to hedge

Perhaps in the coming days, portfolios will receive hedging positions. Traditionally, futures on indices of Russian stocks are used for hedging.
A brief overview of the PRObonds portfolios. Yields 12.3-13.9% per annum, new changes in bond positions and willingness to hedge
All portfolio transactions are published in advance in the public domain – here, at www.probonds.ru/posts and at https://t.me/probonds