How to save savings from depreciation during the holidays

For a long time, bank deposits were considered the most popular and reliable investment in the Russian Federation. However, after the Central Bank took a steady course to reduce the key rate, the attractiveness of deposits has noticeably decreased since the beginning of the year. At the end of May, according to the Banki.ru portal, the average rate on deposits in the TOP-15 banks attracting the largest volume of deposits was 5.92%. The profitability of deposits will decrease, which means that the chances of beating inflation are small. Recall that this year the Bank of Russia forecasts inflation at the level of 4.5-6.5%.

Lost its former brilliance and another “favorite” of private investors – residential real estate. The market for new buildings is clearly “overheated”. Residential “squares” are getting cheaper in almost all regions of the country.

Under these conditions, citizens’ money “flowed” into the collective investment market. Conservative investors, first of all, were interested in OFZ issued by the Ministry of Finance. “The bond market, as a rule, outperforms official inflation and bank deposits over wide time intervals,” said Anna Gondusova, director of client relations at Alfa Capital Management Company.

The recently signed Decree of the President of the Russian Federation on the mandatory substitution of Russian Eurobonds will most likely increase the demand for Eurobonds and, as a result, stimulate their investment attractiveness. Today, issues of replacement bonds allow you to buy them with a yield to maturity of more than 8% per annum in foreign currency.

“Don’t forget about another great tool – individual investment accounts. They are always relevant, in any conditions,” added Gondusova.

Another interesting area for investment is dividend stocks. The Russian stock market is now in the middle of the dividend season. The brightest surprise for shareholders was prepared by Sberbank, which recommended dividends in the amount of 25 rubles. per share (divided yield of 10.5%) is a record level for the bank. In the financial sector, Bank Saint Petersburg was also pleasantly surprised: for 2022, it paid 21.15 rubles. per share, which corresponded to a 12.6% dividend yield at the cut-off date.

As Vasily Karpunin, head of the information and analytical content department of BCS World of Investments, told MK, Bashneft decided to pay unexpectedly large dividends – 199.89 rubles. per share (13.6% according to current quotes of preferred shares). The Beluga Group also pleased with large dividends (400 rubles per share at the end of 2022, the dividend yield by the cut-off date was 8.5%). Surprisingly large dividends for last year are going to be paid by LSR: 78 rubles. per share, or 11.7% dividend yield on current quotes. Tatneft’s final dividends also turned out to be higher than analysts’ expectations.

There are other positive dividend stories as well. According to Gondusova, Sovcomflot recently confirmed that it would send 50% of its net profit as dividends. This gives investors a 7% dividend yield for only the 1st quarter, and by the end of the year, the dividend may already be double-digit. PhosAgro recommended a dividend for the 1st quarter of 2023 of 3.5%. It is expected that Rusagro will also decide on generous payments.

Recall that in order to receive dividends, you need to hold securities at the closing date of the register. It is first recommended by the board of directors of the company, and then approved at the general meeting of shareholders. Those who hold shares on the cutoff date will then receive payouts.

As always, not without a fly in the ointment in a barrel of honey. Thus, the boards of directors of Norilsk Nickel, Gazprom, VTB recommended not to pay dividends this year. But these decisions did not spoil the mood of most investors. Everyone understands that in the end, solid dividends from large issuers will favorably affect stock indices.

According to Karpunin, at the end of May there may be liquidity inflows from large dividends of Sberbank, in June – from Lukoil, Inter RAO, Polyus, in July – from Rosneft, MTS, Tatneft, etc. In conditions of low liquidity, the potential reinvestment of these funds can support the Moscow Exchange index. Now the share of private investors in the turnover of shares is a record 80%, and for them the dividend factor is just one of the key factors in making investment decisions,” the analyst emphasized.

It is no secret that the tense geopolitical situation between the Russian Federation and the West increases the nervousness of Russian investors. “Today it is important to create a balanced portfolio made up of different types of assets. It should include blue chips, second-tier stocks, OFZs, corporate bonds, Eurobonds, gold, currencies and commercial real estate. It all depends on how much free money the investor has and what opportunities he has,” said Alexander Tsyganov, director of the investment and corporate business department at Tsifra Broker. In his opinion, Russian stocks have good upside potential.

However, not all experts share this point of view. According to financial analyst Sergey Drozdov, now is not the best time for buying: “From October–November 2022, the Moscow Exchange index rose well and approached the level of 2700–2720, after which a technical correction is possible due to local “overheating” of the market in a wide class assets. Plus, the market is “playing out” the latest stories with company reporting, dividend stories.”

According to Drozdov, the topic of deep diversification is no longer relevant. Moreover, in the current realities, such income can be very disappointing. According to the analyst, it is better to focus on clear ideas – the shares of Sberbank, Lukoil and, possibly, Tatneft. But it is wiser to buy these three papers not now, but rather after the correction.

Recently, there has been a growing interest in investing in gold, which is traditionally considered an alternative to dollars and euros. Against this background, Goznak began selling gold bullion bars weighing 10 and 20 g to individuals.

“The time to invest in the precious metal is over. Such purchases should have been made last year, when the ruble was strong, and gold quotes were trading at low levels, Drozdov is sure. He recalled the correction that has been brewing in the US stock market: when securities are sold, investors usually “go” to the dollar, and the strengthening of the dollar creates a negative background for gold stock quotes.

Drozdov is also skeptical about foreign investment. Today, Western banks are massively warning customers from the Russian Federation about the forced separation of accounts. “Even friendly countries such as Kazakhstan claim to segregate the accounts of Russians. The risks of freezing assets in foreign jurisdictions are constantly growing. In addition, due to the rupture of agreements with the Russian Federation with Western countries, the risks of double taxation are growing. What is the point of buying American stocks if you then have to pay more than 30% tax on dividends? It’s time to remember the saying: where you were born, it came in handy, ”concluded Drozdov.