INVL Asset Management, one of Lithuania’s leading asset management companies, is reorganizing the portfolio of investment funds it manages. In the first half of November this year, the INVL Absolute Return Subfund was closed by decision of the company. In addition, the INVL Emerging Europe ex Russia TOP20 Subfund will be merged into the INVL Baltic Fund. The Bank of Lithuania approved the merger on 18 November; its completion is planned on 15 January 2020.
“Having until now increased the number of mutual funds, at this stage we’ve reviewed the palette of funds considering efficiency for clients. We decided to halt the INVL Absolute Return Subfund, which did not reach critical asset size, and we are merging the INVL Emerging Europe ex Russia TOP20 Subfund into the INVL Baltic Fund. The increase in the number of INVL Baltic Fund’s participants and division of fixed-size fees among them will make investment terms more favourable for them,” said Vaidotas Rūkas, the Chief Investment Officer at INVL Asset Management.
He said it was also important that the investment strategies of the funds being merged partially overlap – some investments of the fund being merged in, like those of the INVL Baltic Fund, were directed to the Baltic region.
Assessing the performance of the funds being merged, data for end-October show the INVL Emerging Europe ex Russia TOP20 Subfund’s return over the past 5 years was 16 percent (its benchmark index’s was 2.4 percent). The INVL Baltic Fund’s return for the same period was 54.7 percent (its benchmark index’s was 67 percent).
Following the merger, the INVL Emerging Europe ex Russia TOP20 Subfund will cease to operate, with the INVL Baltic Fund assuming its assets and liabilities. The participants of the INVL Emerging Europe ex Russia TOP20 Subfund will become participants of the INVL Baltic Fund; units they own will be converted free of charge into units of the INVL Baltic Fund, which will continue operating after the merger.
In light of the funds’ merger, participants of the INVL Emerging Europe ex Russia TOP20 Subfund will be able to submit requests to buy, sell or switch the investment units they hold in the fundup to and including 7 January 2020. Until the same date, investors in the INVL Emerging Europe ex Russia TOP20 Subfund can also switch units they hold in the fund for units of another subfund of the INVL Umbrella Fund free of charge.
The INVL Baltic Fund’s assets under management at the end of October 2019 were EUR 4.3 million, and it had 560 participants. Meanwhile, the INVL Emerging Europe ex Russia TOP20 Subfund had assets under management of EUR 8.5 million and 2 804 participants. The INVL Absolute Return Subfund had EUR 0.37 million of assets under management at that time and 13 participants.
The company also operates the INVL Emerging Europe Bond Subfund (with assets under management of EUR 30.5 million and 536 participants at end-October), the INVL Global Emerging Markets Bond Subfund (EUR 6.7 million, 126 participants), and the INVL Russia TOP20 Subfund (EUR 7.8 million, 790 participants).
INVL Asset Management is part of the Invalda INVL group, whose companies manage pension and mutual funds, alternative investments, private equity assets, individual portfolios and other financial instruments. Over 200 000 clients in Lithuania and Latvia and international investors have entrusted them with more than EUR 900 million of assets.