The brokers on the Bucharest Stock Exchange (BSE) expect shares to provide much better yields than banking deposits and government securities in 2004. The prospects look even more promising given that the euro, the main competitor in 2003, no longer seems to have the same growth potential. As for the dollar, it is almost not worth mentioning as an investment, given that the ROL gained nearly three percentage points against the American currency last year for the first time in fourteen years.
"I am again betting on stock market yields of 25-30% a year, no high risks attached. Romania is clearly moving towards the European Union, the economy is growing, many of the listed companies are looking better and better and this will show in the trend of the shares," says Rares Nilas, general manager of BT Securities, Banca Transilvania's brokerage firm.
BSE enters 2004 after an outstanding year - 2002 (when quotes redoubled) and a good year - 2003 (when the market rose 30%).
"The Stock Exchange yields have been twice higher compared with the inflation over the last few years and I expect the trend to maintain in 2004. The economy is growing, and some of the finest Romanian companies are listed on the BSE. The potential is high, especially for the shares in the first tier," Nicolae Ghergus, head of operations with Active International says.
Figures prove investments on the capital market have been and still are among the most profitable, but they are only for those willing to risk. Conservatives have and will undoubtedly bet on investments in euros and on banking deposits.
For those betting on the euro, which rose nearly 18%, 2003 turned out to be the second year of substantial gain, with the monthly yield possibly exceeded by the ROL banking deposits in the second half. Following the decline of the interests on ROL banking deposits to real negative levels in the first half, the second half witnessed a trend reversal and most of the banks upped interests on ROL deposits by 50% on the average.
Dealers and treasurers are now saying we will see the increase in the ROL/EUR exchange rate slow down, due to the euro peaking at about $1.35 on the international markets. They also bet on a higher volatility of the ROL/USD rate and believe interests will resume a downward trend again, but no sooner than April or May.
Whoever gains or loses remains to be seen, as the nose and the risk appetite will weigh heavily when making decisions.
oana.nuta@zf.ro ; laurentiu.ispir@zf.ro
