Collective investment and asset trust management market, the first half of 2008

2 trillions: unconquered peak

The asset trust management market amounted to 1.8 trln rubles by the end of the first half of 2008 and decreased by 5% versus the first quarter. The market failed to reach 2 trln rubles and even shrank in monetary value for the first time since Expert RA started to monitor its activities. Still, despite deceleration in the first half of 2008 we expect the market to catch up in the second half of the year. Funds of qualified investors, temporary free funds of state corporations and the budget and assets of sharers who traditionally get back to the market in autumn are to be the growth key drivers. The end of the year is expected to see 2.5 trln rubles.

Development vector

The market future is dependent on combined effect of three main factors of development. The "world market" factor relates to the crisis at the Western financial markets. The "old risk" factor has become more urgent in time of active and non-standard interference of the state into economic operations of companies. The current example of Mechel is closely remindful of Yukos. The "financial center" factor is one of the possible growth drivers - the state will inevitably strengthen and support the stock market as well as the market of collective investment and asset trust management.

The market long term perspective relies on the financial sector ability to develop faster.

Long term investors are wanted

Behavior of sharers in the first half of 2008 implies that collective investments constitute the area of activity for speculators. Even the biggest market players had to face notable withdrawal of assets in time of volatility at the stock market. Big management companies cannot behave aggressively due to big amounts of funds under their control, as distinct from smaller players, who can easily beat the market at a short distance through speculative strategies and small turnovers. Sharers have left the market after several months of negative development without showing any interest in systemic moves of management companies, being really concerned only of a short-term speculative profit.