Three funds start investing in government securitiesAs of December 2019, three of the Mutual Funds - DSK Alternative 1, DSK Alternative 2 and DSK Alternative have also started investing in securities issued or guaranteed by countries. Although funds have been able to make such investments after changing their rules in 2018, so far, their investments have focused primarily on bank deposits.
Under current market conditions, interest rates on bank deposits are practically zero, and for large corporate and institutional clients (including mutual funds), most commercial banks in Bulgaria charge even negative interest rates on accounts and deposits. This is also the main reason for the inclusion of new financial instruments in the funds' portfolios, thus seeking opportunities to achieve a better return on investment. Investors in the three funds should bear in mind that the addition of securities issued or guaranteed by countries in the range of instruments used could improve the yield on these funds, but also increase the volatility in the unit price - there are possible fluctuations in the unit price - both increases and decreases. Since the portion of securities investments issued or guaranteed by countries in the portfolios of these funds will be limited to about 50% of their assets and, at the same time, their maturity will be limited to 5 years, the fluctuations in the unit price should be insignificant.
All investors have the opportunity to be informed on a monthly basis about the structure of the fund portfolio and their results through the monthly bulletins published on the website of DSK Asset Management AD and distributed in the branches and offices of DSK Bank, which distribute mutual funds.