"Do not constantly build up risk." Billionaire Timur Finance about private investment boom

2020 is a record low key rate of the Central Bank and interest on deposits. And at the same time - an unprecedented influx of private investors in the stock market: 400-500 thousand new customers begin to invest every month, this is the maximum increase in interest in 25 years. By the beginning of December, about 8.5 million brokerage accounts of individuals were registered on the Mosbirzh. This year’s investment boom, economist Andrei Movchan discussed with Timur Turlov, general director of the Fried Finance investment company, in a special issue on the Bell.Club Live YouTube channel. Retelling the main thing briefly.

Than the 2020th was good for investors

The record growth of interest in investments by Turlov connects with the disappointment of people risk -free and quasibular instruments of fixed income - they have to look for profitability in the stock market. The general feeling of instability due to pandemia played a role. “In our holding this year, investors opened this year under 100 thousand accounts,” says director of Frida Finance. For 12 months, the growth of the client base in Russia amounted to 27%, and this trend will remain, he said: “People have received a very positive investment experience. Many of them only tried and share their experience with friends. Many of them according to the results of this test will decide to expand their portfolio. ”

Next year, the appetite of new investors to risk will most likely not be reduced, Turblov believes: “The worst of all is not sharp movements in the market, but stagnation. For brokerage business, the worst thing is to see the RTS index for 1400 points for five years in a row (value for 21.12.2020 - 1332 points). ” But he does not recommend increasing concentration in the most risky assets, advising to act carefully and diversify the portfolio.

“It was a good year, investors earned on primary placements ( IPO ), in general, all companies selling NASDAQ trading on the Exchange . Those desperate guys who still own Tesla (I know that they exist) - you are also incredibly lucky, ”says Turlov. In 2020, Tesla capitalization increased seven times: according to the results of the first bidding this year, the company cost $ 93.8 billion, and on December 21, 2020-$ 657.4 billion (in November, a historical record was set-$ 695 billion). But now the time has come to “persist” - “this is a great moment,” Turblov believes.

“There is no need to constantly increase the risk,” he believes, “especially if you feel wings and it seems to you that it will always be. Know how to keep it under control, do not give greed to defeat you, do not give greed to turn your 20% risky assets of 30%, 50% or 90% of the portfolio, even if everything goes very well. ”

Fried Finance is the Russian part of Freedom Holding Corp., the only broker from the CIS whose paper is traded on the NASDAQ exchange. The holding conducts brokerage, dealer and depository activities, its capitalization on December 21, 2020 - $ 2.61 billion. Pure revenue for 6 months that ended on September 30, 2020 - $ 126.1 million. In December 2020, Freedom Holding shares were included in the MSCI US Small Cap 1750 indexes and MSCI US Investable Market 2500.

Since the beginning of 2020, Freedom Holding shares have increased more than three times - from $ 14.69 to $ 44.79 per share (the entire NASDAQ 100 index is 43%, from 8872 to 12,690; data from January 2 to December 21, 2020). But Turlova, according to his admission, is more pleasing to the growth of quotations (“The price has risen today, tomorrow has been adjusted”), but an increase in the volume of transactions and the number of market makers in the securities of the company. “I am pleased that our paper is stable for $ 30 million per day - this is really very cool for me. The fact that our shares were filled with this liquidity is definitely victory, ”the entrepreneur shares.

What surprised the market this year

Of the events that surprised the market this year, Turlov calls the IPO of the Russian online retailer Ozon. “It suddenly turned out that in the portfolio of AFC“ System ”[before the placement was the largest shareholder of the retailer, owned 43%] almost the most expensive asset - not“ children's world ”, not MTS, but Ozon. The company, we will be honest, with a difficult fate in recent years have spent a very successful IPO, and it was made simply at the best time that could be done at, ”says Turlov. On November 23, the Russian online retailer OZON posted shares on the Moscow Exchange and NASDAQ, it managed to attract $ 990 million (and taking into account the options of underwriters-almost $ 1.14 billion). According to the results of the first day of trading, the company has risen in price by 34%, and from the moment of accommodation by December 21 - one and a half times (from $ 30 to $ 45 per ADS). The book of applications during placement was re -signed by 20–25 times, wrote RBC. “I just envy all Ozon shareholders, and“ five ”bankers for organizing,” says Turlov.

In general, according to Turlov, 2020 should be considered exceptional for both the entire market and for its company. “For example, for the IPO this year, the market conditions were beautiful, abnormally high even for record volumes of placements of the last ten years, a record amount of money was raised by companies during an IPO,” he says. -Our “Primary Plane Fund” has doubled, and I would not suggest this when this PIF was formed at the time of the March-April correction. This fund invests up to 10% of the value of net assets in each placement. It turned out to be widely diversified, and dozens of papers are now lying in it. ”

How will Frida Finance develop

The Strategy "Fried Finance" - to develop in two directions.

The first is to diversify the grocery portfolio, launching new products. For example, Frida Finance has issued a banking multi -ore card, which allows customers to get direct access to money on brokerage accounts. “An investor can sell promotions and immediately buy something in the store or withdraw money at an ATM. It would be impossible to do without your own bank in a group, ”explains the general director of Fried Finance. In addition, in Kazakhstan Fried Finance in Kazakhstan there are now two insurance companies. “We see synergy,” says Turlov: the company’s reputation manages to scale, and the broker brand allows you to capitalize the reputation of the insurance business too.

The second direction is the expansion of geography. Frida Finance works in Russia, Kazakhstan, Ukraine, Kyrgyzstan, Uzbekistan, USA and Cyprus. Plus, not so long ago, the company entered the European market, opening a representative office in Germany. And, according to Turlov, the number of German accounts is already going on thousands, which gives the company hope for the further development of branches in Europe. Also, Freide Finance plans to increase investments in the development of its IT infrastructure.

In December Freedom Holding Corp. announced the purchase of the American broker Prime Executions (is a member of the NYSE and NASDAQ exchange). This will give the company direct access to US exchange and the ability to serve American investors. “This is a ticket to the US domestic market, a ticket that few people from our region can be extremely difficult to get and boast (and no one from the Republic of Kazakhstan, for example),” says Turlov. - This is a manifestation of trust from the regulator. More than 600 million shares per month now pass through Prime, our customers will bring almost 300 million (the total market in the USA - 40 billion shares per month). ”

Today, Russian brokers compete not only between each other, but also with global players, who also give our investors access to international markets, including in the USA. At the same time, it is the local player - Frida Finance - is very successful, Turblov emphasizes. He explains this by his proximity to the audience: “Our localization itself is a fairly significant competitive advantage ... For a retail client, it is important to have a reliable partner who speaks the same language with him in the same regulatory space.” He emphasizes: “We are talking with the client in the same language, we are much closer, it’s easier to sign the contract with us. And we give him analytics and research in Russian. ”