A change in rhetoric from leading central banks on the movement of key interest rates was reflected in negative movements in financial markets in February. The aggregate bond index reported a decline of -3.3% for the month, while developed country equity markets fell -2.4%.

Until a month ago, given the state of the economy and expectations of a recession, most forecasts predicted that central banks would soon be done raising interest rates. However, economic data released in February turned out to be better than expected. On the one hand, the better data indicate that the economies are not yet entering a recession. On the other hand, this data means a continuation of the rise in interest rates, which is perceived negatively by investors.

Among the positive economic data: a strong labour market with unemployment rates lower than before the pandemic in many countries; the Purchasing Managers' Index (PMI) improved in most major developed economies; gas prices in Europe fell by 40% compared to the beginning of the year, reaching EUR 50 per megawatt hour. At the same time, however, inflation remained higher than expected, albeit easing from the previous month. In the US, the consumer price index recorded a 6.4% increase, while in the euro area it rose by 8.6%. Keeping inflation higher than forecast means that interest rates will also be higher for longer than originally expected.
 

Performance of Compass Global Trends

Compass Global Trends MF ended the month with a price per unit of £1.1933, up 0.49% for the month and 9.41% year-to-date.

Price per share of the Fund for the period from 1 April 2014 to 28 February 2023.

Performance of Compass Euroselect

Compass Euroselect ended the month with a price per share of EUR 0.8693, down -0.30% for the month and down 5.40% year-to-date.

Price per unit of the fund for the period from 16 July 2018 to 28 February 2023.

Performance of Compass Funds Select-21

Compass Funds Select-21 ended the month with a price per share of BGN 0.9214, an increase of 0.10% for the month and 3.21% from the beginning of the year.

Price per unit of the fund for the period from 26 July 2018 to 28 February 2023.



 

Disclaimer:
This information is marketing material and does not present investment consultation, advice, investment research, or investment recommendation. The information is valid as of the issue date of the marketing material and may alter in the future. The value of the units in the collective investment schemes changes over time and it could be higher or lower from the value at the time of the investment. No profits are guaranteed and risk exists for the investors to not receive the full amount of their investments. Investments are not guaranteed by a guarantee fund which is created by the country or another form of guarantee. Information on the performance of the financial instruments in the past is not a reliable indicator for future performance. Therefore, it is recommended for investors to acquaint themselves with the Prospectus and the Document with key information for investors before making a final investment decision. You can find these documents in Bulgarian on the website of Compass Invest - www.compass-invest.eu, and you can request and get a free paper copy at the office of the management company at: Sofia, 19 George Washington Str, floor 2, during every business day from 9 am to 5 pm. Future results are subject to taxation, which depends on the personal situation of each investor and may change in the future. A summary of the rights of the investors is available at the following hyperlink in Bulgarian: here. The mutual funds, which are managed by Compass Invest, are actively managed without following an index. We would like to inform you that Management Company Compass Invest can make a decision to terminate the offering of funds on the territory of the Republic of Bulgaria. The investment in units of mutual funds, in addition to benefits, carries certain risks like: liquid, operational, interest, currency, and political risk, as well as macroeconomical risk, currency risk, concentration risk, etc. The full information about risks can be found in the Prospectus of the respective fund.

Risks:
Despite benefits, the investment in shares of mutual funds brings certain risks like:
1) Market risk with the following components: a) interest risk related to a decrease of the value of the investment due to a change of the interest rates levels b) currency risk related to a decrease of the value of the investment, denominated in a currency which is different from BGN and EUR c) price risk related to a decrease of the value of the investment in the case of unfavorable changes of the market’s prices;
2) Credit risk – related to a decrease of the value of the position in the case of unexpected events with a credit nature which are related to the issuers of financial instruments, the counter side of exchange and OTC transactions, as well as countries, in which they operate;
3) Operational risk – from errors or flaws in the system of the organization
4) Liquidity risk – in case of forced sales of assets under unfavorable market conditions;
5) Concentration risk – in case of incorrect diversification of exposures to groups of related clients, from the same economic branch, geographic area, etc.
6) Position risk which is related to the change of price of a certain instrument in result of factors related to the issuer or in case of a derivative instrument – related to the issuer of the base instrument;

Additional information for the risks can be found in the Prospectus of the respective fund, which is available here: www.compass-invest.eu