Fund Strategy

Investment strategy of the Fund: how transactions between investors and business projects are planned and executed

Successful investors always have a strategy that guides their decisions to shortlist and select projects. Our investment Fund is based on a clear plan of action that will help us move forward confidently, even when there are volatile economic conditions. This investment strategy allows you to maintain stability, and to develop and offer the best solutions for partners.

What is the investment fund strategy based on?

The Fund conducts fair and transparent activities, which enables us to be competitive. Our Fund is chosen for its reliability, and this creates the basis for a long-term partnership. Trusting relationships and comprehensive support of investors and clients are one of the elements of our strategic mission.

An investment strategy has clearly described methods and actions to achieve financial results. It implies specific tactics for managing capital in the market under different market conditions.

Our tasks and goals are aimed at development, therefore our specialists:

• regularly conduct in-depth analysis of assets and market conditions;
• monitor the economic situation in the country and on the investment market;
• make forecasts for the growth of investment portfolio assets and GDP in Moldova;
• study the economic landscape.

All this makes it possible to be “on the pulse” and choose effective ways to promote and protect investments.

Types of investment strategies

There are various types of strategic action plans in the investment market. Investors choose strategies for the style and method of investment. They are distributed depending on the risk and the ratio of profitability in three directions:

Aggressive strategy. The focus here is on great profits with a yield of 50% per annum, while investments are accompanied by high risk. Investments are made in projects with such characteristics – products without capital guarantees. Also, this approach differs in duration – the investment period is 3 or more years. Such projects have low reliability and need constant monitoring.

Moderate strategy. This includes investments with a partial capital guarantee. Income in such a business project is expected to be 20-30% per annum. There is a risk of losing your investment, but the risk level is lower than that of aggressive strategies. The nature of the investment in terms of duration for such strategies is moderate – 2-3 years.

Conservative method. This strategy has a low level of risk. The conservative investment option is suitable for investors who do not have special investment experience. It allows you to gain 15-20% per annum and the risk is lower.

Our National Investment Fund offers conservative strategies to ensure the reliability of financial activities. Thanks to this option, projects can rely on resources to implement the business plan from investors who are interested in the enterprise. They are also suitable for those who seek to block inflation without studying the functional processes of the market.

Strategies also differ in terms of the market efficiency criterion, according to the theory of Eugene Fam, and the participation of investors in projects. This classification assumes the division of all operations into two types:

1. Active Type with the direct participation of the investor in all operations – adjusts the volume of investments, selects objects, and manages transactions.
2. The Passive Type is based on Fam’s theory and claims that it will not be possible to overtake the market and there is no need for active investment management.

With an active strategy, efficiency in relation to the market according to Fam’s theory is rejected, and the activity is aimed at instant profit. In contrast, the passive approach involves “put and hold” behavior. Dividends are expected to be received from price changes, which will increase in the long term in this business project.

Parameters of our strategy

The Fund’s investment strategy is based on versatility and organizational improvement. We are convinced that in the investment market it is important to remain stable and provide services with different types of strategic directions. This will allow each investor and project to select a partnership option on favorable terms for them.

When developing the strategy, the following factors were taken into account:

• smoothing risks;
• increased profitability;
• saving liquidity.

We apply management experience and efforts to maintain the business opportunities of investment companies.

The main strategic goal of the National Fund is to find new technologies for investment activities for the growth of the company. With positive indicators of the Fund’s functioning and minimization of losses, projects can count on participation with a successful financial result.

Therefore, we focus on these parameters:

1. Maintaining financial stability. Solvency and creditworthiness help to confirm the stability of the financial plan. To do this, we optimize expenses, treat savings with responsibility and accelerate capital turnover in current assets.
2. Strict cost and risk control. Our specialists work to optimize risks – we balance marginal costs with marginal benefits.
3. Growth in operating and financial performance.
4. Financial performance and ratios depend on strategic management and expanding relationships. We carefully plan all financial changes so that this has a positive effect on the growth of indicators for investors and projects.
5. Expansion of business areas.
6. A wide coverage of enterprises with different directions, the implementation of strategies of different levels and types allow expanding the structure and increasing capital.
7. Increasing the market capitalization of the investment portfolio.
8. The value of the company, its business transactions and deposits with a guarantee for our partners and customers.
9. A well-thought-out structure and personnel policy. In the work of the Fund, we focus on its organizational structure so that it covers all areas – analytics, planning, business. Only a full-fledged system contributes to the smooth execution of tasks. We are also actively working to improve corporate governance standards.
10. Improving the profitability of core business areas. The profitability of enterprises depends on the optimization of working time and the amount of resources used. Investments in key business areas improve the economic situation of the market and increase the demand for this activity.
11. Diversification of the investment niche and assets allows you to keep the fund’s activities in the current position and find successful ways of implementation. Investments in different projects will allow you to get the maximum profit, because without a portfolio of investments, your exposure is greater.

Before choosing a strategy and investing in a specific area, it is recommended to analyze the market and project opportunities, to establish the degree of risk. For this, the investment Fund offers a wide range of services to projects and investors. Our experts will make the necessary calculations for you so that you can conclude a profitable deal for you at the safest level.