OREANDA-NEWS. At the end of June the Parvest Equity Russia fund received the top rating of five stars from Morningstar. 

Vladimir Tsuprov, CIO of TKB BNP Paribas Investment Partners, who is the lead investment adviser for the fund, commented on the results: 

"The top rating is a well-deserved sign of recognition for our team of highly qualified professionals located in Russia, who have been working together for many years to build a robust investment process. We are stock-pickers. The key characteristic we are looking for is the ability of a company to generate added value for its shareholders. This means that projected sustainable free cash flow yield should be high relative to the market average and ideally higher than the required cost of equity. Focus on the sustainable free cash flow exists due to this indicator being a better reflection of the company health than others, especially earnings. Sustainable free cash flow takes into account investments that need to be made by the company in order to maintain a stable production level, while depreciation and amortisation, incorporated in earnings, could be rather misleading for many companies in Russia. In addition, we consider a strong alignment of majority and minority shareholders’ interests to be a crucial factor given that it promotes efficient use of the generated cash flow for dividends, decrease of leverage or investment into growth".

A top rating of five stars is also a reflection of the consistently high performance of the Parvest Equity Russia fund, as it is one of the few Russian equity funds in the world which were better than most of their peers* each year during 2010-2014.

* In the first or second quartile vs peers according to performance in the Morningstar database.

 Data Source - © 2015 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

Morningstar stars rank from 1 to 5, with the top ranking being 5 stars. All Morningstar ratings shown in this document are for Classic capitalising shares, as of 30 June 2015.