Expat Capital, with its licensed wholly-owned subsidiary Expat Asset Management, is the largest independent asset management company in Bulgaria – with hundreds of clients from 34 countries and investments in all asset classes in 55 markets worldwide. Expat provides case-tailored wealth management and fund management solutions with opportunities for higher levels of asset protection, return, and control compared to traditional forms of savings.
In addition to the individual investment accounts, the company manages a family of 18 funds:
- 3 mutual funds for bonds and equities investing in the global markets
- 11 exchange-traded index funds tracking the performance of stock indices from the CEE region – listed on the London, Frankfurt, and Sofia stock exchanges (the listing on the Ljubljana Stock Exchange is in progress)
- A fund investing in global artworks
- A ‘short’ fund which tracks the inverse performance of the Bulgarian SOFIX index
- A fund investing in gold (in the process of licensing)
- A real estate investment trust (REIT)
Expat’s portfolios performed well in the financial markets crisis this spring, by taking several key steps:
- Expecting a potential crisis, we decreased the amount of equities in our clients’ portfolios to record low levels before the crash of the markets
- We bought PUT options which protected the equities in the situation of falling prices
- Our bonds were mainly investment grade (BBB- and above) and with a short maturity
From April 2020 onwards, we have benefited well from the price increase of equities, bonds, oil, and gold.
Our aim is to identify and offer good investment ideas in all market conditions, incl. through creating innovative products and services:
1. Investments in gold: Expat is in the process of licensing a new fund – Expat Gold Fund, which will be traded on the Bulgarian Stock Exchange
A lot of analysts around the world predict an increase in the price of gold from the current USD 1,763, potentially even up to USD 2,000 – USD 3,000 per troy ounce. We believe that a significant increase in the price is possible for the following reasons:
- If there is a risk of high inflation worldwide due to the printing of money – for now, money is being printed, but there is no inflation
- If the feeling of risk increases around the world – with or without the pandemic, this would lead to risky times and worried investors
- If the very low interest rates policy continues – for now, there are no signs of interest rate increases anywhere around the world
- If the central banks continue to increase their gold reserves – which is currently happening
The new Expat fund is in the process of licensing. Currently, our clients get exposure to this asset class through physical gold funds worldwide.
2. Expat Global Art Fund achieved a return of +27% for its first year since inception
- The fund gives to a wide range of investors the opportunity to benefit from artworks as a separate asset class.
- As of now, the fund has a portfolio of around 400 art pieces, which can be viewed on the website www.expatglobalart.com. If you wish to make a purchase, please contact us.
- One can also buy shares of Expat Global Art Fund. Currently, the price is around BGN 128 per share.
The fund is suitable for nonprofessional and professional investors who are seeking risk diversification in asset classes with low correlation to capital markets.
3. Equities and bonds
- Through the investment account with Expat, the client has access to investment opportunities worldwide in all asset classes.
- When it comes to bonds, in the current market situation, we prefer instruments with a higher credit rating (over BBB-) and a shorter term of maturity.
- Regarding equities, currently, we hedge our positions with a combination of PUT options. In periods when we expect a rise of the markets, we use CALL options.
- We actively manage the portfolios and tactically change the asset allocation. When managing the equities portfolio, we dynamically manage the choice of region/country and industry based on our risk assessment models. In the bonds portfolio, we use strategies for choosing the country/region, positioning on the yield curve and managing the interest risk. We use derivatives to manage the currency and market risk and to collect additional returns through different strategies.
- As an addition to the standard portfolio management processes, we use relevant thematic strategies for return increase and provide a unique management approach considering many factors such as economic growth, inflation, international trade, monetary and fiscal policy, climate change, new technologies, and political dynamics.
For more information: www.expat.bg