Profit from the commodities markets and local-currency bonds

Two new funds with exciting investment focuses have been available for subscription since the beginning of June:  

• Raiffeisen-Active-Commodities focuses on raw materials
• Raiffeisen-EmergingMarktes-LocalBonds gives investors the opportunity to leverage the global emerging markets mega trend and the new investment class of local-currency bonds to their long-term advantage.

Commodities to optimise your portfolio and protect against inflation

“The rapid and significant rebound in commodities prices after the global financial and economic crisis shows how robust the long-term fundamental commodities trends are,” said Mathias Bauer, Chief Executive Officer of Raiffeisen Capital Management. “Even though economic downturns and new exploration and production technologies can potentially cause significant temporary price declines in future, the long-term supply and demand situation points to rising prices for the majority of the raw materials our world economy needs into the foreseeable future. For this reason, this asset class should be included in every portfolio with a long-term, global orientation.”

No company in the world can operate without at least some raw materials. For this reason, the prices and availability of these materials have a key influence on the profits of the companies that process them. A rising standard of living (especially in the emerging countries) and the expanding world population mean increased consumption and growing demand for commodities. Commodities exhibit a low correlation to stocks and bonds by their very nature, making them an ideal addition to any portfolio to reduce its overall risk without impairing its earnings potential over the long term. Because of the positive connection between rising inflation and rising commodity prices, direct investments in commodities can help to mitigate inflation risk. Raiffeisen-Active-Commodities does not invest in individual stocks or physical commodities, but exclusively in commodities derivatives.
 

The emerging markets: from an “exotic peripheral investment” to a global mega trend

“The rise of the emerging markets is the global economic mega trend of the 21st century – and we are just at the beginning of both of these developments,” said Bauer. “Raiffeisen-EmergingMarkets-LocalBonds is one of the first funds of its kind to give investors the opportunity to profit from the new asset class of local-currency bonds over the long term.” The fund invests exclusively in local-currency bonds, whereby the investment universe ranges from government and corporate bonds from the emerging markets all the way to supranational bonds. There are no rating restrictions. The emerging markets currencies are profiting from the long-term economic and political globalisation process as well as from the fact that international investors are seeing these markets as less and less risky. As a result of globalisation, especially Asia’s and Eastern Europe’s emerging economies are producing finished goods for the industrialised countries, while the Latin American and African economies are based largely on the extraction and export of raw materials. This flow of goods and materials into the industrialised countries is accompanied by the flow of large amounts of capital, especially US dollars but also euros, into the emerging markets, where it is converted into local currencies. This in turn causes a high level of demand for local currencies, and causes these currencies to appreciate in value. This long-term appreciation process is also supported by comparatively high rates of economic growth, current account surpluses and the significantly better debt situations of the emerging countries.
 

Funds for knowledgeable investors with a long-term orientation

Both of these new funds are targeted at earnings-oriented investors with experience in securities, and are especially ideal for inclusion in an existing portfolio. The minimum recommended investment horizon is eight years. Both funds can be subscribed starting at either regular investments of EUR 30, or a one-time investment of EUR 2,000. Ask your Raiffeisen advisor for more information!

The latest versions of the published prospectuses of the funds named on this web site including all amendments since their first publication can be found under “Downloads”.