February 2017: Altaica EUR-Asia Emerging Fund: +1.91%

In general the markets in emerging Eur-Asia performed well during February. The positive surprise was Turkey. With a gain of nearly 6,5% it was the best performing country in the portfolio. After months of high volatile and struggling markets, Turkey markets freed themselves. This rally made Turkey indices belong to the best performing markets worldwide during February. In our view Turkey will keep high volatility. The relative low level, reached after last years correction, however gives this market a huge recovery potential.

Russia was the negative surprise (-4%). After a very strong 2016 this markets faced some weakening of the market strength. This weakening can not be disconnected from the global weakening of the oil and gas listings. Unless the oil price was more or less stable, global oil and gas equities faced serious downturns. We see a couple of reasons for this. The big oil companies didn’t meet their earnings expectations during the earnings season. A common reason for the disappointing results is the fact that upstream activities are marginally profitable with oil prices around the $ 50 and the downstream activities are deteriorating. The other big thing is the US shale production. Those producers are much quicker in increasing their production than expected. This latest threat to the oil price is worrying investors. Also India performed strongly by a gain of more than 5%.

The Indian markets recovered from the losses of the last quarter of 2016. Since the first of January the Indian equity markets picked up momentum and are hunting to the top levels of 2015. The current strength of this markets was already able to start a new long term upward trend. This positive signal gives us the confidence to increase the position during the next months. For expansion of the position we wait for a temporarily weakening of the market.

Our Chinese positions booked a positive result of about 4%. During February we increased our position in the Chinese equity markets. However this market performed well during February it is for us still a trading market. We are missing the long term trend signal.