New fund gives Poles easy access to U.S. blue chips
A new investment fund is touting itself as the first service allowing Poles inexpensive access to U.S. blue chips.
The Top Ameryka Fund, recently launched by CA IB Investment Fund Co., is a Polish-registered, open-ended fund investing in companies listed on Standard & Poor's 100, an index of large-cap U.S. stocks. The S&P 100 includes heavyweights such as Intel, Microsoft, and Dell.
"Two days after (investors) put their money in, they're already invested in dollars," said Jan Ziemecki, CA IB managing board member. "Not only does (the investor) have the potential gain from the index performance, but he also has the potential insurance of the dollar to the zloty."
Top Ameryka is accessible to any individual or institutional investor able to make an initial payment of zl. 1,000, he said. Subsequent payments of at least zl. 100 are made whenever a shareholder wishes to buy new shares. Investors buy into the fund in zlotys and through services rendered by U.S. brokerage Morgan Stanley, the Polish currency is changed to its equivalent in dollars before shares are purchased.
The fund focuses primarily on U.S. equities and does not dabble in derivatives trading, Ziemecki said.
CA IB's Top Ameryka is designed for the small-scale investor in Poland, he said. The minimum initial investment is lower than what brokerage houses often require. At the same time, an investor also bypasses brokerage fees and taxes on capital gains. Investment funds aren't taxed in Poland.
A sister fund in Austria, CA IB'S Capital Invest Fund, was used as a model for Top Ameryka, Ziemecki said. Capital Invest in Austria has made a 120% return over the last five years, he said.
CA IB also has under its umbrella an entire "Top" family of funds, including the Top Latin America Fund and the Top Europe Fund, all of which could be available in Poland, Ziemecki said.
Lukasz Piasta, manager of public relations at Skarbiec Investment Fund Co., said his company offers the only other fund that invests in Western markets, though not in U.S. stocks. The Skarbiec Gwarancja Fund, a close-ended fund, reaches maturity in October 2002. Although Skarbiec is estimating individual investment returns at 60-90%, the fund guarantees that investors get back no less than what they originally put in.
An investment of zl. 100 plus zl. 2.50 in fees is all that's needed to buy certificates in Skarbiec Gwarancja. The fund plans to invest 40% of its capital in the Dow Jones Eurostock 50 index and the other 60% in Polish debt securities.
Piasta said he considers Top Ameryka a "riskier" investment with better opportunities for returns than his own company's, but added that the two funds are such divergent investment vehicles that they hardly warrant a comparison.
"We invest in Europe, not in the States ... in options ... not in direct equities," he said.
Closed-end funds, unlike open-end ones that continuously issue and redeem shares, issue only a fixed number of shares known as certificates. Those certificates are only available during an initial subscription offering. Investors can purchase certificates of Gwarancja at approximately 480 brokerage houses throughout Poland.
