Updated Portfolio Structure
Last week, prior to closing the list of unitholders for record 0,027 € dividends, I decided to temporarily increase Baltic Horizon position. I entered at 1,31, with whole cash lying around in portfolio. At the time of writing I also placed order to sell the same amount a little above 1,32. With dividends incoming, it seems like a good deal. But the books are not closed yet, so too early to say anything.
Temporary 0% cash portfolio structure:
Baltic Horizon Fund update
In the end of summer I suggested Baltic Horizon Fund was trading at significant discount (article on Baltic Horizon), which proved to be the case. Buying at 1,25-1,27 range sure was a great bargain, from today’s perspective with a gain of around +12% including two dividend payouts.
Baltic Horizon Dividend History
Price 1.307 (last for 2018) and annualized gross dividend of 0.102€.
Market valuation and discount in relation to Fund’s Net Asset Value (NAV):
Funds Management Comments
As a company of great corporate governance, Baltic Horizon fund does quarterly webinars. These are a great way to acknowledge yourself with recent developments, plans for future and most importantly – ask questions.
Here’s the webinar:
Q&A session starts at 37:30. First three questions were mine.
- At what discount management would continue to buy-back fund’s units in the market?
- Would management consider deviating from target leverage ratio of 50:50 (equity to debt 1), as the global yields and debt costs are increasing?
- Comments and dates on plans to increase Net Asset Value of Current Assets?
Baltic Horizon Fund Buy-back Program
Buy-back program that started in 2018 August officially lasts till 2019 June 19, however in 2018 mid-December buy-backs have stopped, as the price have somewhat caught up with NAV. During this time a total of ~660 000 were bought back, if I’m not mistaken. That comprises only 13% of maximum 5 000 000 units.
Management provided an answer, that a threshold of 5% discount would be where buy-backs would be continued. At the time of writing discount from NAV is -6%.
As I already mentioned I have placed the order for the same quantity to reduce Baltic Horizon to previous level, only because I like having some cash for some immediate ideas (currently looking at Inter RAO Lietuva, for example). I won’t post separate update on the sale, whenever it happens.
Overall, I’m very satisfied with performance of Baltic Horizon Fund and feel comfortable with my relatively large position.