Dear all,
First of all, I want to thank you for being with us during 2016.
It would be hard to find a single description for this year – although there were rather big changes in the markets, in Lithuania, and in the world, still, for most investors it was successful. We began the year watching volatility in the markets, which reacted in late June to the outcome of the UK’s so-called “Brexit” referendum, and at year-end to that of the US presidential election. Despite these changes, focusing on long-term investments and asset accumulation in many cases gave better results than a short-term approach. Seen in perspective, it’s been another year when, worldwide and in Lithuania too, total financial investments grew, as did the proportion of them entrusted to professional investment managers.
We also assessed Lithuanian investment trends over the past two decades, which are heartening. Since 2003, liquid financial assets per capita in the country have increased five-and-a-half times, to 6,000 euros as of the middle of this year, for a total of 17.3 billion euros. During this period, people in the country invested more and more, and as of mid-2016 they had entrusted 3.69 billion euros to professional asset managers.
Even if our comparative indicators still lag behind those of the world’s most prosperous countries, the basic message is positive: people in Lithuania are getting wealthier and, as INVL Asset Management’s first-ever calculation of the Lithuanian Investment Index showed, investing has paid off. So the trends look positive. The average return on investments in Lithuania in 2006-2015 was 4.7 per cent and exceeded the return on many analysed investments, while for the period 1996-2015 it was an impressive 10.6 per cent, confirming the benefits of long-term investments. The Lithuanian Investment Index comprises deposits, long-term bonds, rental housing (excluding expenses), and stocks, in equal proportions. We’ll continue to calculate the index every year and share our observations with you. We hope it will prove to be a useful tool for everyone with an interest in asset management opportunities.
Still, in judging the results for any year, we first of all look at how our clients did. It’s only by creating value for the people and institutions who have entrusted money to us that we can succeed ourselves. We’re pleased that 2016 was successful for the majority of clients who chose investment products managed by the Invalda INVL group. While the year’s not over yet, we can say that in its first nine months the bulk of the pension and mutual funds we manage were among the leaders in terms of the return they earned for investors, which is our intent. We’re also pleased that our investment managers have gotten some well-earned international recognition.
We’ll continue to work resolutely to increase investment opportunities in Lithuania. This year we made it possible to invest in our mutual funds with no required minimum amount, and we launched a new fund for investing in global emerging market bonds. And with the licence we received in October, we’re also preparing new offerings for informed investors, to expand the range of private equity products available.
Wishing you a prosperous and plentiful 2017,
Darius Šulnis
President, Invalda INVL,
General Manager, INVL Asset Management