Factsheet: BlackRock Emerging Europe plc

Emerging Markets

Rated Fund 2017-2018. Invests in niche but potentially lucrative markets

The investment universe of this trust is companies that do business primarily in eastern Europe, Russia, central Asia and Turkey. It offers investors access to a niche area, and for this reason Cantor Fitzgerald analyst Markus Jaffe deems it a strong contender for adventurous investors who can stomach short-term volatility and have a long-term investment horizon.

London-based Sam Vecht has run this fund since 2009. He has a good record of investing in these types of markets as he also runs BlackRock Frontiers investment trust, also a Rated Fund for 2018. Co-manager Chris Colunga joined the Emerging Europe fund in 2016. Their investment approach blends top-down and bottom-up research to construct a concentrated portfolio of 20 to 30 �best ideas'. With input from the team's macroeconomists, Vecht decides on the fund's country allocations at weekly meetings where each country's relative attractiveness is assessed on a variety of macro factors � economic and political developments, as well as currency levels. The managers believe the correct time to buy is often when currencies are weak, economic growth is depressed and markets are cheap. Once general country weights are decided, the team identifies stocks with growth opportunities, with an emphasis on cash flow growth, as they believe this is ultimately the driver of share prices over time. The managers travel frequently to the markets they invest in. Shares in the trust traded at a discount to net assets as wide as 15 per cent over the past three years. At the end of 2017 that had narrowed to around 6 per cent.

Narrative and ratings content all as of 01 January 2018.

See all Money Observer rated funds
Name
BlackRock Emerging Europe plc
Manager
BlackRock
Type
Closed Ended Investment Company
ISIN
GB00B0BN1P96
Sector
European Emerging Markets
Launched
29/11/1994
OCF
1.16 %
Risk Rating
5
3 Year Sharpe
0.84
3 Year Alpha
8.81
Yield
1.6 %
Benchmark
MSCI EM Europe 10/40 NR USD
Fund Size
£ 121.94 million
NAV
347
Gearing
111
Discount Premium
-2
To achieve long term capital growth, principally by investing in companies that do business primarily in Eastern Europe, Russia, Central Asia and Turkey. The Manager's portfolio selection will be unconstrained by benchmark weightings and the Company's portfolio is expected to contain between 20 to 30 holdings at any one time. The Manager will select stocks by combining political and macroeconomic insights with fundamental analysis of companies and by looking for long term appreciation from mispriced value or growth. The weightings of holdings within the Company's portfolio will be based upon the Manager's conviction level and an assessment of upside potential and liquidity.
Holding %
PJSC Lukoil ADR 10.48 %
Gazprom PJSC ADR 9.41 %
PKO Bank Polski SA 6.03 %
Sberbank of Russia PJSC ADR 5.80 %
Rosneft Oil Co GDR 4.63 %
Alior Bank SA 4.49 %
Lenta Ltd GDR 4.30 %
Turkcell Iletisim Hizmetleri AS 4.02 %
Powszechny Zaklad Ubezpieczen SA 3.98 %
Sberbank of Russia PJSC 3.96 %
Region %
Europe - Emerging 84.87 %
Eurozone 10.94 %
Sector %
Financial Services 37.82 %
Energy 26.83 %
Communication Services 11.41 %
Consumer Defensive 5.71 %
Healthcare 5.29 %
Name
BlackRock
Address
02940-8019, Providence, United States
UCITS
No
Legal Structure
Closed Ended Investment Company

Managers

Christopher Colunga
Joined 03/30/2016
Sam Vecht
Joined 05/01/2009

Sam Vecht, CFA, Director and portfolio manager, is head of BlackRock's Emerging Europe equity team. Mr. Vecht's service with the firm dates back to 2000, including his years with Merrill Lynch Investment Managers (MLIM), which merged with BlackRock in 2006. Mr. Vecht began his career with MLIM in 2000 as a member of the Global Emerging Markets team.Mr. Vecht earned a BSc degree, with honours, in international relations and history from the London School of Economics in 2000, and he is fluent in Hebrew.

Data provided by Morningstar.

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