OREANDA-NEWS. January 15, 2007. Finam Investment Holding has tallied the results of its asset management activities carried out in 2007. During the year, average returns under all strategies promoted by the investment holding turned out to be positive. Record gains were achieved by the portfolios with a high portion of second-tier names.

The leader was the Long-Term Growth strategy, as the average value of the portfolios based on it during the year spiked 26.72% and 66% over the past two years. This strategy calls for investing 100% of funds in second-tier names. "The high risk attached to small and mid-cap companies is offset by potentially higher returns. We are of the opinion that in the mid-term outlook these issuers hold stronger upside market cap growth potential than major corporations. We expect this strategy to return 86% in 2008" – Finam Investment Holding strategist Vladimir Sergiyevsky says.

The aggressive strategy, according to which 67% of cash was invested in both liquid and second-tier stocks, achieved an average return of 19.92% in 2007. Over the past two years the portfolios formed as part of this approach have generated the highest profits, up a whopping 81.29%. "We have revised the risks of investing in stock segments on the basis of the results of our activities to run our client's assets. Specifically, the aggressive portfolio was adjusted, with the weighting of bonds increased 2%. In spite of this, expected returns of the aggressive portfolio are projected at 49% in 2008" – Sergiyevsky notes.

Profits earned by investors in line with the balanced strategy averaged 10.98% in 2007 and they were substantially higher over a two-year horizon (64.27%). The balanced approach towards investments calls for investing most cash (58%) in bonds, with the remaining portion of the portfolio equally allocated between blue chips and second-tier stocks. The conservative strategy that focuses on bonds (76%) pushed up the value of investors' portfolios by 11.63% in 2007 and with 2-year gains reaching 49.61%.

"We are of the opinion that in light of the growing risks associated with a global economic slowdown this year financial resources will be redirected into stocks of food producers and sellers, pharmaceutical and precious metal companies. As for soft commodities, we believe grain will remain in demand. People who invest in the related industries, especially fertilizer manufacturers, will also benefit. Among the most appealing investment vehicles in 2008 we would like to highlight the shares of grain and sugar holding Razgulay, Russia's leading juice producer Lebedyansky, retail chain Magnit, nitrogen and phosphorous fertilizer producers Kuybyshevazot and Ammophos as well as Russia's number one silver maker Polymetal. Up to 27% of our model portfolios falls to the securities of these businesses" – Sergiyevsky says.