The basic and long-term objectives of the Company is safe and professional investment of collected money assets, permitted and defined by the Law, liquidity of the Fund, enabling permanent and liberated purchase of the shares in the Fund, leading to higher investment profitability in accordance with the accepted risks.
The profitability is determined by existence of some risks, such as:

Market risk: The price of the securities, that make the Fund assets, may significantly oscillate, dependent on various factors on securities market, such as: audited reports, announcement of profit distribution by the Company, change of the business activities in some industries etc. These factors might effect the investment policy of the Company, resulting with unsatisfactory ascend or descend in the share units value.
The Company can reduce the risk, but can not entirely eliminate it, by managing the market risk by means of investing the Fund’s assets in numerous financial instruments. The diversification of the portfolio generates decrease of the risk on the complete portfolio. The Company will invest in shares of different companies and in different economy branches, restricting the maximum invested shares in a single company.

Interest risk: This risk may negatively influence the value of the Fund’s assets, especially those, consisting of debtor securities. The raise of the interest rates effect the market value of the long-term securities. The Company intends to invest its assets in debtor securities with different maturity terms and to use derivative financial instruments

Credit risk
: This risk suppose the probability, the Company-securities issuer, where the Fund’ assets is invested, is not able to fulfill its liabilities, i.e. to repay the matured principal and interest, which will negatively influence the liquidity and the value of the Fund’s assets. The Company intends to reduce the credit risk by investing its assets in securities, after a prior credit analysis, investment diversification and by following the trends and events in the economy and the politics.

Liquidity risk:
This risk exists as the Fund intends to invest in developing capital markets with shorter history of their stock exchanges, where the risk is higher, compared with the developed capital markets. This may lead to changes in the Fund’s assets value.

Currency risk:
The currency risk is owed to the fluctuation of the foreign currency rates in ratio to the denar. It results with changes in the value of the already invested financial instruments, expressed in local currency. In this case the Company shall invest in financial instruments expressed in different foreign currencies.

Inflation risk:
In case of inflation a significant portion or the entire profit of the share document owners may be compensated, so that they may not receive the real profit or it will be insignificant. The Company intends to keep the balance between its assets with fixed or changeable profitability, following the investment policy and the objectives of the Fund.

Political risk:
This risk is connected to the possibility of eventual local political crisis, in the countries, where the Company invests, or modifications in their economy regulative. This risk is correlated to mistaken policy of a country government, resulting with negative influence on the companies and investor failures. The Company intends to invest the Fund’s assets in countries, where the political crisis have minimum influence on the securities markets.

Risk resulting from modification in the tax regulative:
The modification in the tax regulative may negatively influence the Company’s financial results. It may consequence with reduction in the profitability of the Fund’s investments .The modification in the tax regulative is beyond the Company’s control.

Other risks:
Other risks that may effect the investments of the Fund’s assets are: possibility of political instability or wars in the region or outside. Any future predictions about extreme situation can not be foreseen, but methods for minimization of their negative effects can be found.

Summarizing the above, the risk in investing on the securities markets is characterized by a possibility or a probability that the profits might be insignificant or negative. In comparison to the bank’s fixed deposits, which are secured by the Savings Insurance Agency, the investments in the Fund’s assets are not guaranteed.

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