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From Precy Dumlao, Opalesque Asia:
The Russia-focused Diamond Age Russia Fund gained 7.7% in July (-7.64% YTD), reversing its modest -2% decline in June after strong performance last month fuelled the fund's positive growth.
In its monthly letter to investors, the fund said its July performance beat the results of RTS +6.6%, MICEX +3.7% and global emerging markets. Since its restructuring in 2009, Diamond Age is also significantly higher at 138.6% than the benchmark MSCI Emerging Markets Europe (128.40%), Russian Stock Market (109.76%), MSCI Emerging Markets (98.56%) and MSCI World indices (45.87%).
"Over the past month, leverage was increased a substantial 30% from 58.9% to 76.9%; while shorts in December gold, sovereign bonds (AUS, CAD) and safe-haven Fx were taken up from 0.0% to 16.2%. At the turn, the Fund increased recovery-theme long holdings in commodity Fx (Rouble, CAD, AUD), materials, financial and shipping stocks, E&P, metals (copper, platinum), tanker futures and crude oil; the hardest hit sectors in the crash," the report said.
Outlook
According to Diamond Age, the fund would maintain the bullish outlook that the managers adopted in June. This outlook expect that the bull market which began in March 2009, to remain "solidly in place" and added that most significant advances will be driven by strong gains in cyclical, financials, shipping, metals and mining sectors.
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