WHAT WE'RE UP TO
Russia's military action against Georgia was quite the jarring turnabout for a country that was thought to be so tame that mutual funds managers here in North America have gone and loaded up on its stocks. And then there's the whole resource issue. Russia's a commodity-based economy - lots of oil and gas - and that should be a concern to investors who are heavily exposed to Canadian energy stocks and worried about a downturn in the sector. So which funds have ventured deeply into the land of Lenin, Stalin and Putin?
Funds in all global categories, including emerging markets, were ranked according to their exposure to Russian stocks as of their most recent portfolio disclosure to Globefund.com. One-year return data are included to provide some perspective on how the fund's Russian exposure has worked out.
SO WHAT DID WE TURN UP?
Enough data to show that if you own an emerging markets fund, you've potentially got a fair degree of exposure to Russia. This is especially true if you own the BRIC variant on the emerging market there, which focuses on Brazil, Russia, India and China. BRIC funds from Franklin Templeton and HSBC had 23.1 and 16.4 per cent of their assets, respectively, invested in Russia.
Holding Russian stocks is like investing in any emerging market - you get big upside potential coupled with the risk of big losses. The main Russian stock index, the RTS, was off about 33 per cent from its May peak through the latter part of this week (as measured in U.S. dollars), and it was down about 15 per cent from its level before the Georgian conflict began. That followed a surge of about 50 per cent from August, 2006, to the May peak.
Emerging markets funds have generally been money losers over the past year, as have pretty much all global equity funds. Don't go blaming Russia exclusively, although it has been dead weight lately. Instead, think of Russian stocks as an example of the kind of risks you take on when investing in emerging markets or BRIC funds.
Funds with Russian Exposure
|Name||Equity category||Assets ($million) as of July, '08||Latest MER (%)||Latest reported holiday date||Russia holding (%)||Quartile 1-year||Return 1-year (%)|
|Excel Emerging Europe A||European||16.2||-||7/31/2008||53.7||-||-|
|Templeton BRIC CC||Emerging markets||330.2||2.97||6/30/2008||23.1||1||-0.10%|
|HSBC BRIC Equity-I||Emerging markets||104.1||2.73||7/31/2008||16.4||1||-0.50%|
|Fidelity Emerging Markets-A||Emerging markets||48||3.19||6/30/2008||15.4||4||-10.90%|
|United Emerging Markets CC-A||Emerging markets||0.3||2.67||6/30/2008||13.9||-||-|
|SEI Emerging Market Eq.-O||Emerging markets||151.6||0.2||6/30/2008||11.7||3||-8.00%|
|CI Emerging Markets||Emerging markets||212.4||2.58||7/31/2008||11.2||2||-3.50%|
|CIBC Emerging Markets Index||Emerging markets||130.8||1.28||6/30/2008||11.1||2||-4.40%|
|BMO Emerging Markets||Emerging markets||131.7||2.82||4/30/2008||11.1||4||-10.60%|
|United Emerging Markets Pool-W||Emerging markets||186.3||0.23||7/31/2008||11||1||-1.80%|
|TD Emerging Markets||Emerging markets||254.3||2.76||7/31/2008||11||4||-11.90%|
|HSBC Emerging Markets-I||Emerging markets||22.3||2.73||7/31/2008||10.8||3||-9.10%|
|Renaissance Emerging Markets||Emerging markets||22||2.9||7/31/2008||10.3||4||-12.60%|
|National Bank Emerging Markets||Emerging markets||102.8||2.85||7/31/2008||9.9||3||-9.20%|
|Altamira Global Discovery||Emerging markets||37.2||3.3||7/31/2008||9.8||3||-9.10%|
|CIBC Emerging Markets||Emerging markets||83.6||2.93||6/30/2008||8.2||4||-10.60%|
|Mackenzie Cundill Recovery 'C'||Glbl Small-Mid Cap||1,565.20||2.45||7/31/2008||7.6||2||-20.20%|
|Tmpltn Emerging Markets||Emerging markets||304.2||2.97||6/30/2008||7.2||3||-10.20%|
|Mackenzie Cundill Em Mkts Val cl-A||Emerging markets||280.2||2.84||7/31/2008||7||4||-27.70%|
|Mackenzie Univ Wld Resource cl||Natural Resources||204.3||2.46||7/31/2008||6.9||3||5.30%|
|GGOF Emerging Markets Mutual||Emerging markets||28||2.74||7/31/2008||6.4||1||-1.40%|
|IG Mackenzie Univ Emerg Mkt cl-A||Emerging markets||168.2||3.03||5/30/2008||6||2||-6.60%|
|Mackenzie Univ Canadian Resource||Natural Resources||1,549.30||2.41||7/31/2008||5.1||2||6.00%|
|Mackenzie Univ Emerg Markets cl||Emerging markets||134.6||2.46||7/31/2008||4.8||3||-7.40%|
|Dynamic European Value||European||62.7||2.6||5/30/2008||4.6||4||-29.80%|
|Manulife Emerging Markets Fund||Emerging markets||9.8||2.9||7/31/2008||4.6||-||-|
|Fidelity Global Telecommun-A||Science and Technology||3.6||2.87||6/30/2008||4.4||2||-14.50%|
© 2007 The Globe and Mail. All rights reserved.
Only GlobeinvestorGOLD combines the strength of powerful investing tools with the insight of The Globe and Mail.
Discover a wealth of investment information and and exclusive features.