Stock overview:

1. Lesto stock was bought as one of dividend stocks to our portfolio. Unfortunately few days after purchase some speculations showed up in the news that this year Lesto will not payout any dividends and therefore its value dropped by 2.55% as of this day.
2. Ukio Bankas was very disappointing during last month. After the announcement that Ukio Bankas put 50 million Litas for provisions their stocks plummeted and now we have a depreciation of 8.02% in this position.
3. Tallinna Vesi is still performs very well and at the moment is the only positive stock in portfolio with increase in value of 18.9%.
4. City Service rebounded a little from the last month and now has depreciation of total value by 2.38% compared to 7.03% last month.
5. Merko Ehitus and Lietuvos Dujos at the moment are depreciated by 5.68% and 4.13% respectively.

During next month we don’t have any set goals. But we decided to decrease our cash reserves only if very promising opportunity will show up. Also there is possibility that we will liquidate some of the current positions.

“Unleash your potential. It’s your time to win” – that’s how the 15^th annual Investment Game greets its players this year. The biggest and oldest online stock market simulation in the Baltic States has  started on the 19^th of March. The game allows participants to build up and improve their investing skills and gives them a chance to compete for superb prizes.

The Investment Game is organized by the Investment Fund of the Stockholm School of Economics in Riga, in cooperation with Rietumu Banka. The purpose of the game is to boost young people’s interest in finance and economics and to provide them with an opportunity to test their investing knowledge with no risk in the real market environment.

The game will consist of two rounds, where only the top 500 performers in the first round will be able to compete for the grand prize in the second round. Each registered player will be given an opportunity to manage up to three portfolios, each worth 10,000,000 EUR. Contestants will be allowed to trade in more than 15 different stock exchanges and trade not only stocks but ETFs and financial derivatives as well.

The organizers of the Investment Game would also like to invite university and business school students to participate in a new team-based competition called the 49ers’ Challenge. The rules and conditions are the same as for the Investment Game. Teams of up to 5 will compete for the distinction of their represented organizations as well as the chance to win a valuable and prestigious prize — a pure gold coin.

Both the Investment Game and the 49ers’ Challenge are completely free of charge. Those who manage to achieve the highest portfolio return in both the first and second rounds will be rewarded not only with esteem and additional knowledge, but also with monetary prizes. Top performers will share a prize pool of 2500 EUR. Furthermore, weekly winners will be rewarded with books about finance generously provided to us by NASDAQ OMX.

For more detailed information and registration please visit www.invest-game.com

Stock overview:

1. Merko Ehitus – was bought for short period to earn from speculative movements after announcement of results. But team encountered the problem with exiting position and therefore was obliged to keep the position. Still we think that Merko Ehitus is strong company and is better than other listed real estate companies at the moment. So far we have -1.92% depreciation of this position.
2. Tallinna Vesi- after favorable decision from the court Tallinna Vesi stocks skyrocketed and now bears 14.17% increase in value. Therefore team is now considering two options: to sell and take capital gains or wait for dividends and expect that price will not fall more than dividends.
3. City Service and Lietuvos Dujos are not performing as we expected from them and at the moment we see the fall of 7.03% and 1.75% in value respectively.
4. Ukio Bankas – is the stock that helps use to be still in the race. Although there is speculations about possibly bad results from the bank’s operations the stock is at the moment valued by 10.17% more than at the time we acquired it.

Although the returns of portfolio are still positive we are not overly happy about that because we lost the leading position to OMX Baltic Benchmark fund. Therefore for the next month we are planning to take some more risky tactics to regain our positive difference against index.

The first article of our newsletter is devoted to one of our to an interesting type of business, namely family-owned business. Although nowadays this term seems to sound rather archaic as many companies are primarily public, still there are some examples that have evolved in the past years and have turned into notable giants in their fields. In the article we will deal with the commodity business and some of its greatest specimens in terms of success.

In the second article we shall deal with a company that is undoubtedly recognized by everybody. Yes, this is Nokia, and it looks as if it is not going to give away its positions and is planning to regain its lost share by presenting a range of innovative products. They do seem o look very attractive and unforeseen in the consumer electronics industry, but isn’t it already too late?

As always, comments and suggestions are more than welcome, so we hope you will enjoy reading the newsletter.

Yours financially,

iFund

Newsletter 9

The first article of our newsletter is devoted to one of our neighbouring countries: yes, it is
Belarus. This year the country has undergone several devaluations due to speculative
attacks fostered by speculators and the people in Belarus themselves, who started to
doubt the stability of the rouble. Now major concerns arise whether the country could
follow the path of Zimbabwe and continue to show immense inflation rates in the nearest
future. We will try to find that out.

In the second article we shall deal with a very innovative company, which most likely is
familiar to you: Groupon. After 2 years of successful activities in the world internet discount
market, the company has finally filed for being floated on the stock exchange, namely,
undergo an Initial Public Offering. In the article we shall touch upon the problems facing the
company as well as the prospective results of the IPO.

As always, comments and suggestions are more than welcome, so we hope you will enjoy
reading the newsletter.

Yours financially,

iFund

Newsletter 8

This issue of the newsletter somewhat steps away from the conventional format of the newsletter and shall deal only with companies. The first article concerns the former Swedish automobile giant SAAB, which recently has run into a series of problems and is now seeking its way out of the abyss.

In the second article we shall deal with the world’s most valuable company, namely, Google.
As always, comments and suggestions are more than welcome, so we hope you will enjoy reading the newsletter.

Yours financially,

iFund

Newsletter 7

Perhaps those of you who watch financial news or just keep up with the latest trends have
seen the astonishing video where a Goldman Sachs trader announced that the new crisis
was about to hit next year and that all people should be aware of that. His speech has a
dose of truth, which we will try to elaborate on in our first article.

The second article concerns the LME event, the world’s largest metal event, which dictates
many trends in the world commodity trade. They say that the decisions and discussions
made there largely reflect the state of the world’s economy… and its nearest future.
As always, comments and suggestions are more than welcome, so we hope you will enjoy
reading the newsletter.

Yours financially,

iFund

Newsletter 6

Yours financially,
iFund

Newsletter 5

Newsletter 4

A 31-year-old Ghanaian UBS employee Kweko Aduoboli working in the London office has been charged on charges of “abuse of power in the fraud and false accounting”, Stock Market Today reports. The case was immediately followed in the London Central court, where the guy burst in tears of his past commitments. In the first hearing he was brought accusations of fraud and false accounting. Even though the bank blamed a rogue trader, some inside the firm knew enough to question his trading fairly early on in the alleged scheme, according to a person familiar with the situation. However, either for fear they might be accused themselves or for some other reason the disaster had not been prevented earlier.

UBS in its first press release on Sunday said that the loss resulted from “unauthorized speculative trading in various S&P 500, DAX, and EuroStoxx index futures over the last three months.” However, the UK authorities and invited auditor companies have strong reason to think that the fraudulent scheme dated back to 2008 and they are completely in contra to UBS’s views that the rogue trader acted alone, rather than being covered by his co-workers who in fact knew about his dealings.

Interestingly, the bank then announced in its statement that the positions taken by the trader “were within the normal business flow of a large global equity trading house as part of a properly hedged portfolio,” but the risk of them was masked because the trader also took out fictitious offsetting exchange-traded-funds positions. It all started with a small loss during a speculative action around two months, which Mr. Adoboli then tried to cover by entering a series of risky trading covering the positions with ETF futures.

As WSJ explains the situation that „to avoid showing naked „or revealing his hedging strategy with ETF futures”, or unhedged, trades that would have gotten him in trouble, he needed to show that his trades were offset with bets in the opposite direction of his real trades, according to people familiar with the matter. To do so, he recorded on the company’s books transactions that never took place, according to people familiar with the situation.”

Yet the market overturn in the past months severely undermined his situation which soon became uncontrollable. In other words, he faced the same fate as Nick Leeson who betted on the rise of NIKKEI 225 stocks, yet his plans were devastated after the earthquake in Japan bringing a total of 800 Million pound sterling losses to Barrings, one of the oldest British banks.

More interestingly, the guy did not just conform with the classical ”I’m sorry” note (as Nick Leeson did. UBS said the rogue trader, following inquiries from bank officials who were reviewing his positions, revealed his unauthorized activities Wednesday. Around midday that day, he went home and wrote an email from his personal account to his boss, John Hughes, admitting to the unauthorized trades and providing Mr. Hughes with details of what he had done, according to a person familiar with the events.

The issue is still investigated, so we can expect further updates coming on what really happened in this witty financial scheme. iFund will be the first to inform you so stay tuned for the news.