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APQ Global expects improvement in US/Russia relations

The largest equity positions are in Russia, with APQ bullish on commodity prospects
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APQ is upbeat on commodities

Fund manager APQ Global Limited (LON:APQ) kept its risk exposure ‘moderate’ in the latest quarter due to volatility in emerging markets, its area of focus.

The largest equity positions are in Russia, with APQ bullish on commodity prospects as it believes the strained relations with the US currently will gradually improve on the back of a shared interest to restore stability in the Middle East.

At the end of June, the bulk of exposure was in credit and government bonds (55% of book value), followed by equity exposure (22.6%). EM local currency bond exposure accounted for 13.5% of book value.

A rally in emerging markets bonds and equities eased towards the end June, but with its risk position APQ said it is comfortably on track to meet its 6% annual dividend yield target based on last year’s float price of 100p.

During the quarter APQ paid a dividend of 1.5p, in line with its annual target while book value rose by 0.6% to 97.82p

From a sector perspective, the bulk of the exposure is in energy, industrials and financials, taking into account the sector composition of index exposure in Russia, India and global EM.

On the credit side, Russia accounts for 14.2% and Brazil 13.5% of the portfolio, with government entities, banks and corporations in the energy and materials sectors the main sectors.


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