The returns on PRObonds portfolios diverged even more: the yield on portfolio # 1, which is strictly high yield bonds, fell below 12% per annum (11.8% over the last 365 days), while the yield on mixed portfolio # 2 rose slightly compared to last week, to 12.5% per annum. However, if some force majeure does not happen, from next week the current annual profitability of the first portfolio will begin to increase rapidly for purely arithmetic reasons (due to the portfolio fall at the end of winter 2020). Its average profitability for 2.5 years of management is close to 14% per annum.
In the previous review, a reduction in a number of bond positions in portfolios for the upcoming placement of bonds of Pokrovsky Concern (issuer – Pobeda Agrofirm-breeding plant + 4 agricultural enterprises – guarantors, coupon / yield 9.75% / 10.11%, 3 years to repayment). At the moment, the share has been reduced only in the first issue of Kalita bonds. The rest of the positions will decrease gradually, as the broad bond market recovers or stops in decline. There is already enough money in the portfolios to buy Pokrovsky.
As for free money, their value in portfolios has been above 6% of assets for a long time. Thus, the correction of the bond market, which we observe, is slightly softened for portfolios. After the purchase of Pokrovsky’s bonds, the share of money will again be brought to 6%. In addition, in February or March (rather, in March) there is a relatively high probability of opening hedging positions in portfolios. In order to minimize or block for them the consequences of a possible correction of stock markets.
So the target return for the current year for both portfolios remains 12%.
All portfolio transactions are published in the public domain until they are made.
Not an investment recommendation