Regulars
Vivid SHARE PORTFOLIO
by Adrian Stefanescu
March 2005
Our investments in the SIFs and BRK have proven to be inspired, pushing the performance of the Vivid portfolio to an increase of 534 per cent from its inception as at the beginning of 2004.
Sustained by the strong bullish market, which spectacularly continued its rally in the first six weeks of the year, Broker Cluj (BRK) which launched its IPO in November last year, was listed on the BSE on 17th January and traded around ROL 40,000 compared with its IPO price of ROL 15,500. The success of Broker’s IPO emphasises the appetite for new stocks among investors, in a market with more idle money than opportunities.
Despite the fact that we’ve a return of more than 150 per cent in only three months on BRK, we didn’t rush to sell it once it had listed. We prefer to look at BRK rather as a portfolio than a brokerage company since its revenue from capital gains is substantially greater than its income from brokerage fees. However, the company divested its largest holdings in bluechips (BRD, SNP) during January, in the middle of a bullish trend. Thus, being mostly on cash at present, at a price per book of almost 3x, keeping the stock is akin to buying cash three times more expensive. Accordingly, we have decided to sell our BRK at ROL 41,000 per share.
We continue to trust our investments in the SIFs which still seem undervalued compared with their listed peers as well as with the general market level at present, while different groups of investors are still fighting for their control.
HOW THE PORTFOLIO STANDS
| Company |
Quantity |
Price |
Average |
| SIF Banat Crisana |
100,000 |
14,500 |
9,850 |
| SIF Moldova |
140,000 |
13,300 |
8,250 |
| SIF Oltenia | 146,000 | 15,000 | 7,450 |
