An investment in one of its simplest definitions, "is a way to use money in order to get more money" (www.supervalores.gov.co). Obviously, getting more money in the most efficient way is not as easy as it sounds; The study of investments should take us into the analysis of a large number of variables: inflation, exchange rate, interest rates and the economic cycle, among others.
The aim of this report is then to simulate the work of the financiers in charge of recommending where to invest the money. There will be a distribution of the work in two parts, in the first part, - which we will call - before investing, an attempt is made to cover the topics or "tips" that must be considered in advance when making any good investment. For this part, the advice of the experts will be of vital importance, for which it is only necessary to look at the electronic addresses of organizations such as Suvalor, Corfivalle, Infofinanciera, Dinero and Superintendencia de Valores, among others. Here, too, an attempt will be made to elucidate the current macroeconomic and stock market environment, since, as will be seen later, it will be of crucial consideration when choosing where to “put the money”.
In the second part we will define the investment strategy and the value of each of the assets will be assigned.
how-to-make-an-investment-portfolio-in-colombia- BEFORE INVESTING
When you decide to invest, the best thing is to seek professional help (stock brokers, investment funds, etc.). Nowadays, getting this type of help is very simple, you just have to resort to the internet, to a good search engine and include the words "investment strategies" or "how to invest" and a good number of pages related to the topic. With this information, we will try to carry out a preliminary analysis that allows us to predict that we will invest our money in options with the great possibility of generating profitable rewards for a "minimum" irrigation.
1.1 Attributes of a good investment (Made with information from the Millionaire Stock Market game)
- Security:
It is related to the greater or lesser risk of recovering the investment and the agreed interests. There are basically 4 risks to consider:
Inflation risk: It is the possible loss of the purchasing value of the currency.
Exchange rate risk: Refers to the effect that variations in currency may have on the investments chosen.
Interest rate risk: It is understood by the probable decrease in future income due to changes in this variable.
Issuer risk: It is explained as the level of payment capacity by the entity offering the security.
Our study should then understand what is the behavior and expectations of inflation and interest and exchange rates, as well as assess the strength of each entity by calculating basic financial indicators.
- Cost effectiveness:
Profitability depends on the returns generated by owning a certain financial asset. This concept is closely related to risk, since the higher the risk that an investor perceives, it will directly translate into the demand for a higher level of profitability.
Profitability is also associated with time: more time = higher rate of return; This is because the holder of the title will not have the money in a longer period of time.
- Liquidity:
Liquidity is an indicator of how easily a certain asset has to be transformed into physical money. A security is also said to have liquidity when it can be easily sold, or when the expiration date is close.
In the second part of this work we will analyze what our decisions will be regarding these three aspects.
When it comes to investing… there are several alternatives, even the idea is to access several of them, that is, not to put all the eggs in the same basket. The philosophy, so to speak, in the formation of an investment portfolio is to distribute risk while ensuring returns; which is nothing more than choosing financial assets with relatively high rates of return, assuming the implicit risk, and weighing it against other securities with greater support and therefore less remuneration.
Among the options we can choose titles R enta F IJA and equity. Depending on our profile as investors, the allocation of our resources will vary considerably. For this reason, we should try to establish what is our level of risk aversion. In order to know what the risk tolerance scale is, the pertinent questions will be asked when defining the investment strategy. It is also appropriate to reflect on the types of investors that exist:
There are three types of investors, depending on the level of risk tolerance, there are risky, conservative and moderate. The main characteristic of the first profile is the preference for variable income securities: stocks and currencies. The second category covers those investors who do not want to take risks; Among its options are the RF papers: TES, CDT, bonds and investment funds. The third topic refers to those who evaluate the possibility of forming an intermediate portfolio: without much risk but with higher expectations of return than the market. We can clarify what our profile is by analyzing the current market conditions at the time.
It is time then to continue with what seems to be the guide that the experts offer; after taking a look at the elemental, you must continue with the evaluation of the environment.
1.2 Macroeconomic Environment
It is indisputable that stock exchanges are the thermometer of an economy, and as such, any variable that affects the country, either positively or negatively, is sure to have an impact on the negotiations of different investment alternatives. This is how the political, social and economic environment, especially variables such as: interest rates (DTF), the dollar (TRM), economic growth (GDP), inflation (CPI) and unemployment, have a great
Importance before making any investment decision.
- How is the economy
It is evident that the growth path the economy has been going through does not follow its same trend. The fall in sectors such as industrial, transport and construction have even led the government to change its growth target, going from 4% to 2.4% annually. The most basic reason could be attributed to the high level of unemployment that does not allow consumption to not reactivate.
Growth sources: SUVALOR
But unemployment is also a cause of a series of events that have weakened the economy and does not allow it to grow at acceptable rates to generate employment. On the one hand, there is the high fiscal deficit, increased throughout the 1990s. This fact is one of the main managers of the crisis experienced by our country in 1999 and from which it has not yet been possible to steadily emerge. It can be highlighted that public spending increased to levels of over 35% of GDP in 1999 and as of 1995 a gap between income and expenses began to appear; deficit that in 1999 reached 10% of GDP. This situation began with the constitution of 1991, with the creation of entities such as the Office of the Prosecutor and the Attorney General, among others. Then,The Samper government is credited with wanting to heal its bad political image with high public spending and an excessive increase in bureaucracy. The high deficit forces this government to finance itself in the domestic market by pressing interest rates upwards and reducing the capacity of the private sector to make productive investments. The Pastrana government received a crooked economy, whose adjustment required sacrifices in terms of employment. The agreement with the IMF forces to put the house in order and to restructure the institutions with the obvious consequence: higher unemployment.The Pastrana government received a crooked economy, whose adjustment required sacrifices in terms of employment. The agreement with the IMF forces to put the house in order and to restructure the institutions with the obvious consequence: higher unemployment.The Pastrana government received a crooked economy, whose adjustment required sacrifices in terms of employment. The agreement with the IMF forces to put the house in order and to restructure the institutions with the obvious consequence: higher unemployment.
Although not everything is the fault of the fiscal deficit, the international crises (Asia, Russia and Brazil) and the monetary restriction policy imposed by the Banco de la República in 1998 to defend the exchange rate band were also aspects that helped the decline.
However, 2000 was the year of recovery: Annual GDP grew by 2.8%, the industry grew at levels greater than 10% and inflation was again in the single digits, but unemployment continued to rise and was at a rate close to 20%. Starting in the second half of this year, growth has been decreasing; the armed conflict, the crises in emerging economies, signs of a US recession and the downward price of oil have been factors that explain this event.
The important thing about having made this brief review is to identify the origin of the crisis and explain in broad terms why our economy has not yet taken off.
- What awaits us
The favorable point that can be highlighted is the behavior that inflation has been exhibiting, allowing it to stand at 8.02% per year in August of the current year and at levels close to 6% year-to-date (January-August), which ensures that The goal proposed by Banco de la República will be met.
The positive margins shown by inflation have allowed Banco de la República to maintain an expansionary policy and to reduce intervention interest rates on several occasions, a reduction that moved to interbank and DTF rates. Suvalor forecasts that at the end of the year the DTF will stand at 13.8%.
Interest rates and Inflation. Source: SUVALOR
The exchange rate, according to several analysts, presents devaluation expectations; the continuous fall in interest rates (may lead to increases in the currency to avoid capital flight), the policy of boosting exports while maintaining competitiveness in terms of trade, the gaucho crisis and the recent attack on the USA may be the causes of a possible depreciation of the local currency against the dollar. However, the agents do not want to speculate with the currency, since the General Treasury of the Nation has more than US $ 1 billion that will possibly be monetized. Suvalor forecasts an exchange rate of $ 2,430 per dollar by the end of the year and a devaluation of 9% annually;for its part, the Banco de la República projects an 8% devaluation and a number of analysts consulted by Dinero expect the average rate to close at $ 2,450.
TRM. Bank of the Republic source.
For the economy in general the climate does not seem to be very clear, the current attack perpetrated in the United States can have dire consequences for trade with that Nation, since more than 50% of Colombian exports are directed to that State. Additionally, the Hugo Chavez government has announced trade restrictions for various products imported by Venezuelans. On the other hand, the uncertainty generated by the pre-electoral stage, in the sense of the direction that the peace talks may take, raises a certain degree of suspicion from investors; Such situation added to the high rates of placement, do not allow to give clear lights for the subject of employment. We will have to wait what happens with the labor reform proposed by the government.
In conclusion… the economy does not take off, unemployment remains high, international shocks are expected and the armed conflict does not present short-term solutions. However, low interest rates are expected, as well as inflation and a relatively sustainable devaluation.
1.3 Stock Market Environment
After joining the country's three stock exchanges in July this year, the non-bank capital market does not appear to have the expected trading volume, although this fact can be attributed to the current state of the economy.
Theoretically, it should be assumed that the stock market should be more dynamic. As a consequence of the fall in interest rates, investors choose to shift their resources towards equities, but this does not happen in Colombia. The participation rate of the equity market in the B olsa of V alues of C olombia sector averages 1% (see graph); The big piece of the cake is taken by the fixed income market (public + private debt) with levels that range between 70% and 85% of total transactions. The second place is for the currency market with rates close to 20%.
Charts made based on BVC data.
Investor preference in the fixed-income market on the last few wheels has not shown a clear sign that stocks weigh more. As can be seen in the previous graph, the participation percentage of the most traded securities shows a certain degree of competition, although it is possible to visualize how in late August the primacy of CDT becomes more evident, followed by TES and TESUSD, then going through ordinary bonds and finally public debt bonds.
The superiority of CDTs could be due to the fact that they are highly tradable securities and highly accepted in the financial market; However, the strength that TES have gained is explained by the fact that they are zero risk securities and the rates they recognize are not very far from those of the market.
It must also be recognized that the vast majority of Colombians only save in the short term, and fixed income accommodates this inclination.
Concluding … Despite the low interest rates, fixed income continues to gain ground, with CDT, TES and TESUSD standing out with higher shares, and secondly dollars.
- INVESTMENT STRATEGIES
In selecting an appropriate investment strategy, it is necessary to indicate very clearly the objectives, the time horizon and the risk tolerance of your investment.
- Investment objectives (taken from the text Investments. Kolb)
Knowing the fact that the investor is in a constant position to try to secure high returns on the investment while trying to control the exposure to risk, the investment goal can be expressed as follows:
Or,
- Investment horizon (taken from the Millionaire Stock Market game)
The investment duration term must be identified: short or long term ?, for which it is recommended to consider the following questions: When will the money be needed ?, When do I want to spend the money ?, What do I want to use it for ?.
- Risk tolerance
Calculate the risk tolerance capacity asking yourself the following questions: in which financial position are you? How old are you? What is your cash flow? Where does the investment money come from?
In response to these approaches and in order of importance, the allocation of resources will seek to ensure a return with the least possible risk, it will be a short-term investment (2 months), which indicates, according to theory, that we should choose for financial assets issued by solid and easily tradable entities, which give the portfolio a highly acceptable degree of liquidity.
2.1 What the experts recommend
| Money Portfolio | |||
| Investments | Distribution | Cost effectiveness | Cost effectiveness |
| % | year run | projected 2001 | |
| CDT AAA Rating | twenty | 7.9 | 15.8 |
| Pension funds | 30 | 14.4 | 18.5 |
| RF in dollars | 35 | 7.9 | 21.5 |
| Shares in pesos | 5 | 21.9 | 5 |
| Shares in dollars | 5 | 1.4 | 23.3 |
| Euro | 5 | -0.1 | 5 |
| Investment / return | 100 | 9.8 | 18.6 |
SUVALOR's recommended portfolio for 2001.
Expected return and risk.
Investment Recommendations (Suvalor)
Some Accuracies
- Diversification: Do not put all the eggs in the same basket.
- Risk Tolerance: Not all assets are for everyone.
- The asset that is expected to be the most profitable is not always the most advisable (Be careful, the projections are risky).
2.2 Formation of the portfolio
Given the current economic situation and the type of investment that will be made, we will be conservative investors with a high preference for fixed income expressed in TES and CDT from entities with good credit quality; On the other hand, the funds provide liquidity to our portfolio, since these are investments on demand (liquidity immendiata), so they will also occupy an important place and we will leave as a last option the North American currency, which however will not be left with minimum allocation: the dollar is likely to rise.
- Portfolio distribution
| Investment | % | In $ |
| Fixed rent | 68% | $ 108,800,000.00 |
| Securities funds | 12% | $ 19,200,000.00 |
| Dollars | twenty% | $ 32,000,000.00 |
| Total | 100% | $ 160,000,000.00 |
- Fixed income distribution
| Titles | In $ | In % | Amount Titles |
| CDT | $ 29,857,670.00 | 27% | 3 |
| TES $ | $ 24,993,920.00 | 2. 3% | 3 |
| Bond | $ 10,136,600.00 | 9% | one |
| TES USD | $ 43,811,810.00 | 40% | 5 |
| Total | $ 108,800,000.00 | 100% | 12 |
Our inclination for public debt securities is obvious: 65% of the total assigned to fixed income; The reason ?, The market for TES and TESUSD in Colombia is increasingly dynamic, traded and therefore highly liquid securities, not in vain the government has been able to place until June 2001 a sum of $ 7.8 billion in TES. Additionally, these are zero risk securities.
Regarding the TES in dollars, ¨During the first quarter of the year investors were very focused on acquiring external public debt. Now this trend could take more strength considering that local interest rates are at unattractive levels. In this order of ideas, it would seem more attractive to acquire government debt expressed in dollars. One point to keep in mind in this decision is the gap between TES and Colombia's external bonds. For example, the bonds of May 2006 have a yield of 9.40% per year.
If to this investment a devaluation of 8.00% is added in the next year or a coverage to 360 days for the same percentage, the profitability obtained is 300 bp (3%) higher than in local currency, since it would be comparing a July 2006 TES at 15.10% EA vs. an external bond from June of the same year at 18.15% EA The question at this point is, again, what is the market betting on, inflation or devaluation ? ¨.
The decision on CDT is based on the boom that these assets have been taking on the last wheels, the choice of issuers is based, in order of importance, on the profitability of the securities, the maturity date and their solidity in the short term.
Finally, we opted for a private sector bond, because as seen in the stock market analysis, these show a better performance than public debt bonds; In addition, the profitability is higher and the expiration date shorter.
The selected entities correspond entirely to the financial sector: Colmena, Leasing de Occidente, Davivienda and Corficolombiana. This determination is due to two reasons, first: they are the largest providers of financial assets in the BVC, and second: the sector has been accumulating profits throughout the year.
- Results of the financial system
During the first half of the year, the financial system registered profits of $ 234,397 million, after having presented losses for the same period last year of $ 1 trillion.
This situation is mainly explained by the lower weight of net provisions, as a consequence of the recoveries of provisions as the economy has been recovering, and the lower operating costs through the reduction in administrative expenses.
Additionally, as a result of the lower demand for credit that the financial system has been experiencing during the last two years and the greater credit risk that banking represents for some sectors, income other than interest per portfolio gained participation within total income., which went from 21.9% to 35.6% in the last two years. In this way, banks have diversified sources of income with items such as investment valuation and financial services.
- Titles acquired
Financial assets purchased on September 3, 2001 at the BVC.
| Value title | Value to invest | Price | Purchase Value | Interest | Cost effectiveness |
| CAV Hive Bond E-196 | $ 10,000,000.00 | 101.366% | $ 10,136,600.00 | DTF 2.3 (90) V | 14.85% |
| CDT COR. FI CORFICOL | $ 10,000,000.00 | 103,879% | $ 10,387,900.00 | 14.94 (184) V | 15.14% |
| CDT CAV. DAVIVIENDA | $ 10,000,000.00 | 101.815% | $ 10,181,500.00 | DTF 2.1 (90) V | 15.00% |
| CDT LEAS. OF OCCIDE | $ 9,000,000.00 | 103,203% | $ 9,288,270.00 | 13.94 (156) V | 13.70% |
| TES IN PESOS 1 | $ 4,300,000.00 | 93,780% | $ 4,032,540.00 | (360) V | 13.82% |
| TES IN PESOS 2 | $ 11,000,000.00 | 91.488% | $ 10,063,680.00 | (360) V | 14.20% |
| TES IN PESOS 3 | $ 10,000,000.00 | 108.977% | $ 10,897,700.00 | 15.00 (360) V | 14.78% |
| Total | $ 64,300,000.00 | Total | $ 64,988,190.00 |
| Value title | Investment value $ | Price | Inv value in USD | Vr. Buy $ | Vr. Buy USD |
| DOLLAR TES 1 | $ 10,000,000.00 | 103.175% | $ 4,338.11 | $ 10,317,500.00 | $ 4,475.85 |
| DOLLAR TES 2 | $ 10,000,000.00 | 102,846% | $ 4,338.11 | $ 10,284,600.00 | $ 4,461.58 |
| DOLLAR TES 3 | $ 10,000,000.00 | 103.111% | $ 4,338.11 | $ 10,311,100.00 | $ 4,473.07 |
| DOLLAR TES 4 | $ 10,000,000.00 | 103.184% | $ 4,338.11 | $ 10,318,400.00 | $ 4,476.24 |
| DOLLAR TES 5 | $ 2,499,719.05 | 103,220% | $ 1,084.41 | $ 2,580,210.00 | $ 1,119.32 |
| Total | $ 42,499,719.05 | Total | $ 18,436.86 | $ 43,811,810.00 | $ 19,006.06 |
| Total purchase value of CDT, bonus and TES $ | $ 64,988,190.00 | |
| Total purchase value TES in dollars | $ 43,811,810.00 | |
| Total value of resources used in Fixed Income | $ 108,800,000.00 |
- Issuer Analysis
Davivenda
| Information as of June 30, 2001 | (Millions of pesos) | |||
| Davivienda | ||||
| Growth indicators | ||||
| Current quarter | Previous quarter | % variation | ||
| Assets | 4,226,067.95 | 4,127,039.66 | 2.40% | |
| Investments | 300,222.83 | 280,296.18 | 7.11% | |
| Credit Portfolio | 774,128.07 | 654,212.15 | 18.33% | |
| Deposits and Requirements | 3,339,005.63 | 3,240,943.68 | 3.03% | |
| . Term Deposit Certificates | 1,332,260.38 | 1,314,306.75 | 1.37% | |
| Debts to pay | 87,478.40 | 80,831.55 | 8.22% | |
| TOTAL LIABILITIES | 3,773,317.66 | 3,701,314.43 | 1.95% | |
| TOTAL ASSETS | 452,750.30 | 425,725.23 | 6.35% | |
| OPERATING INCOME | 429,568.89 | 497,338.91 | -13.63% | |
| OPERATING COSTS AND EXPENSES | 404,537.09 | 442,839.46 | -8.65% | |
| OPERATIONAL UTILITY | 25,031.80 | 54,499.45 | -54.07% | |
| PROFITS (SURPLUS) AND LOSSES | 24,904.41 | 25,015.83 | -0.45% | |
Although the level of profits has comparatively decreased, it is possible to observe a growth in important indicators in the good management of a credit institution. For example, the loan portfolio has grown 18.33%, CxP 8.22% and deposits 3.03%, which shows that its collection margins have increased. On the other hand, and following the trend shown by banks to diversify their business, investments increased by 7.11%. As a last aspect to highlight, it is seen how equity rises at higher rates than assets, granting the entity a substantial solvency.
| Specialization | CDT | 40% | |
| DEPOSITS | |||
This relationship indicates that of $ 100 million that Davivienda captures, $ 40 million is through CDT; Quite significant indicator if you consider that it is a bank where its possibilities of collecting money from the public are diverse (savings and checking accounts, for example).
Profitability indicators
| Asset profitability | Operating profit | 0.59% | |
| Total active | |||
| Return on equity | Net profit | 5.50% | |
| Heritage | |||
¨ The return on equity shows the rate of return on investment that the executives of the company have in relation to the capital entrusted to them. But sometimes, the formula can lead to wrong conclusions. For example, a low-quality company can achieve a high return on equity by showing a profit with a low figure. For this reason, it is also recommended to calculate the return on the asset.¨ (Taken from How to understand Wall Street).
The profitability of the asset shows the rate of return that executives achieve with the operation of the business.
Generally, the RA must be less than the RP, since the risk of the business operation must be covered by the profit produced on the capital.
| Solvency | Heritage | 10.71% |
| Active |
Indicates the percentage of the company that belongs to the owners. In other words, it means: it is the part of the assets that comes from the shareholders' own resources. In the case of Davivienda, it represents a percentage that goes with the average of financial entities.
Corporate Image. (Taken from www.davivienda.com)
Davivienda has LA CASITA ROJA as a symbol, which within its multiple and significant connotations: Home, Family, Warmth, Safety, Protection, Union, Happiness, Joy, Solidity, has managed to be identified and recognized with much affection by all Colombians.
DAVIVIENDA is an intermediation and financial services entity, oriented to individuals and families, specialized in the promotion
of savings and home financing.
It seeks leadership within the financial sector with image, profitability and market share, based on innovation,
greater efficiency in its operations and better quality of the products offered to its clients.
It has a team of motivated and trained officials, who enjoy a pleasant work environment and who are supported
by modern and efficient physical and technological resources.
DAVIVIENDA, as part of Grupo Bolívar, will cooperate and share skills and business with the other companies that comprise it,
to achieve synergy in the overall results.
Short-term credit quality rating: DP1 +, issues with the highest certainty of timely payment. Short-term liquidity, protective factors, and access to alternative sources of resources are excellent.
Western Leasing
Before carrying out the analysis of this organization, it is pertinent to indicate that the theoretical reference and the meaning of the indicators have been explained in the previous part (Davivienda Analysis), so our passage through the description of the indicators corresponding to the rest of the entities, it will be shallower.
| Information as of June 30, 2001 | (Millions of pesos) | |||
| Western Leasing | ||||
| Growth indicators | ||||
| Current quarter | Previous quarter | % variation | ||
| Assets | 353,156.00 | 356,247.90 | -0.87% | |
| Investments | 15,171.73 | 13,133.76 | 15.52% | |
| Credit Portfolio | 53,971.95 | 44,208.64 | 22.08% | |
| Deposits and Requirements | 215,804.01 | 174,491.11 | 23.68% | |
| . Term Deposit Certificates | 214,356.15 | 174,027.81 | 23.17% | |
| Debts to pay | 13,734.72 | 15,695.87 | -12.49% | |
| TOTAL LIABILITIES | 320,706.43 | 322,394.72 | -0.52% | |
| TOTAL ASSETS | 32,449.57 | 33,853.18 | -4.15% | |
| OPERATING INCOME | 45,604.71 | 46,593.35 | -2.12% | |
| OPERATING COSTS AND EXPENSES | 52,055.54 | 60,741.79 | -14.30% | |
| OPERATIONAL UTILITY | -6,450.83 | -14,148.44 | 54.41% | |
| PROFITS (SURPLUS) AND LOSSES | 2,789.55 | -1,592.41 | 275.18% | |
The performance of Leasing de Occidente in improving its profits, both operational and net, is truly significant. Additionally, indicators such as investments, portfolio, deposits and CDT have also risen considerably. Equally notable is the behavior of costs and the reduction of liabilities, which allows a significant restructuring process to be glimpsed within the organization. However, the unfavorable point is in the fall in assets and equity. Even so, we consider that most of its indicators show a fundamental improvement.
| Specialization | CDT | 99% | |
| DEPOSITS | |||
In this case, this relationship cannot tell us much, since being a Commercial Financing Company specialized in Leasing, it is only allowed to capture through CDT.
Profitability indicators.
| Asset profitability | Operating profit | -1.83% | |
| Total active | |||
| Return on equity | Net profit | 8.60% | |
| Heritage | |||
Here it can be ensured that the entity, operationally, is not being productive, however the shareholders are achieving relatively acceptable rates of return on their initial investments.
| Solvency | Heritage | 9.19% |
| Active |
It is a percentage quite similar to the rest of the entities of the financial system. For this reason, acceptable for our investment decision.
Corporate image (Taken from www.leasingdeoccidente.com.co)
Leasing de Occidente is part of the Luis Carlos Sarmiento Angulo Organization. It was born on August 6, 1981 to give a timely response to the needs of reconversion of the Colombian company.
Traditionally, Leasing de Occidente has held a leading position, not only for its solidity, its volume of operations and its profitability, but also for the service it offers to its clients and the constant development of new products to satisfy the needs of the different sectors of the economy.
Leasing de Occidente has more than 16 years of experience in "being close", close to companies and people who, like you, work to always go forward.
We are a financial institution where your goals and objectives set the tone. A flexible company that designs its products and services in such a way that they are truly adapted to your needs.
Leasing de Occidente is made up of a group of people with an open mind, who listen to your ideas and concerns to recommend the best leasing, credit and investment alternatives. A company with the necessary infrastructure and strength to support you in your projects and carry them out.
Short-term credit quality rating: BRC2 +, is the third category of investment grade. It indicates that, although there is a high level of certainty regarding the timely repayment of capital and interest, the level is not as high as for issues rated 1.
Colombian Corfician
| Information as of June 30, 2001 | (Millions of pesos) | ||
| Colombian Corfician | |||
| Growth indicators | |||
| Current quarter | Previous quarter | % variation | |
| Assets | $ 1,346,448.60 | $ 1,185,864.70 | 13.54% |
| Investments | $ 300,222.83 | $ 280,296.18 | 7.11% |
| Credit Portfolio | $ 774,128.07 | $ 654,212.15 | 18.33% |
| Deposits and Requirements | $ 632,236.28 | $ 415,533.40 | 52.15% |
| . Term Deposit Certificates | $ 608,867.39 | $ 413,846.03 | 47.12% |
| Debts to pay | $ 27,678.65 | $ 27,897.52 | -0.78% |
| TOTAL LIABILITIES | $ 1,186,058.96 | $ 977,621.66 | 21.32% |
| TOTAL ASSETS | $ 160,389.64 | $ 208,243.04 | -22.98% |
| OPERATING INCOME | 96,602.39 | 111,744.85 | -13.55% |
| OPERATING COSTS AND EXPENSES | 145,085.69 | 181,072.10 | -19.87% |
| OPERATIONAL UTILITY | -48,483.30 | -69,327.25 | -30.07% |
| PROFITS (SURPLUS) AND LOSSES | - $ 45,126.20 | - $ 45,081.76 | 0.10% |
Although it is an entity that shows growth in key indicators such as assets, investments, portfolio and deposits; shows a deterioration in the level of operating profits and a minimal improvement in net profits, which still continue to be highly significant losses. However, it recently received a capitalization of $ 1 billion.
The investment decision was based on the yield offered by the security (15.14%) and on the days to maturity (88).
| Specialization | CDT | 96% | |
| DEPOSITS | |||
It is understood as a high level of uptake through CDT.
Profitability indicators
| Asset profitability | Operating profit | -4% | |
| Total active | |||
| Return on equity | Net profit | -28% | |
| Heritage | |||
It would be useless to analyze these indicators, their detriment is perceptible. Again, we indicate that our decision was based on the profitability and liquidity of the security.
| Solvency | Heritage | 12% |
| Active |
This relationship is understood to be that of $ 100 million that Coficolombiana has valued in assets, $ 12 million belongs to the owners.
Corporate image. (Taken from www.corficolombiana.com)
The Corporación Financiera Colombiana SA, CORFICOLOMBIANA SA., Is the first financial corporation created in Colombia, developing its activities continuously for more than 40 years, its foundation dates back to 1959.
During the year 1999, it carried out the merger process with three financial corporations, namely Corporación Financiera de los Andes, Corporación Financiera Santander and Indufinanciera, managing to organize and optimize the resources acquired, forming an operational, physical, organizational and commercial infrastructure. very efficient. It is important to highlight that the first two corporations mentioned had recently carried out similar processes with other entities in the same sector: Corfiboyacá, Corfes, Corfiprogreso and Corfitolima.
Between 1999 and 2,000 it received a significant capitalization of more than 130,000 million pesos, a process through which the entity's assets were strengthened, and it contributed to continue executing its activity with ample solidity.
Today its main shareholders are: Banco de Bogotá 66% and Banco de Occidente 26%.
Corficolombiana SA belongs to GRUPO AVAL which is one of the four most important economic organizations in the country, with investments in various sectors of the economy.
Short-term credit quality rating: DP1, issues with very high certainty in timely payment. The liquidity and protection factors are very good and the risks are negligible.
Hive
| Information as of June 30, 2001 | |
| Hive | (millions of $) |
| Financial statements. Important items. | |
| Current quarter | |
| Assets | 2,645,000.82 |
| Investments | 361,216.52 |
| Credit Portfolio | 1,766,171.52 |
| Deposits and Requirements | 2,220,698.12 |
| . Term Deposit Certificates | 983,569.91 |
| Debts to pay | 52,282.86 |
| TOTAL LIABILITIES | 2,487,436.03 |
| TOTAL ASSETS | 2,487,436.03 |
| OPERATING INCOME | 249,596.22 |
| OPERATING COSTS AND EXPENSES | 247,691.51 |
| OPERATIONAL UTILITY | 1,904.71 |
| PROFITS (SURPLUS) AND LOSSES | 712.65 |
It is important to note that it was not possible, after having consulted the Supervalue and the Hive pages, to acquire the information from the previous quarter, so the calculation of growth indicators was not carried out. However, Colmena is seen to present significant profits, both operational and net.
Profitability indicators
| Asset profitability | Operating profit | 0.07% | |
| Total active | |||
| Return on equity | Net profit | 0.03% | |
| Heritage | |||
It is evident that the profitability levels shown by this entity are too low. Despite this, to make our decision for this title, the fact of being a higher yielding bond weighs, in comparative terms.
| Solvency | Heritage | 94.04% |
| Active |
What this data indicates is that almost all of the assets belong to the shareholders, a favorable point if one takes into account that it can give a significant sense of belonging to the management of the company.
We ended by indicating that a more thorough analysis could not be carried out due to the lack of information.
- Securities Funds
For this part of the investment, we assign the sum of $ 19,200,000, equivalent to 12% of total fixed income. It will be distributed in two funds: Surenta 30 and Esparta. These are highly profitable funds and significant support.
The $ 19,200 will be distributed in equal amounts for each fund.
Surenta 30:
Unit value = 2,049.84
Value to invest = $ 9,600,000
Units purchased = Investment value = 4,683.29
Unit value
Sparta:
Unit value = 1,447.20
Value to invest = $ 9,600,000
Units purchased = Investment value = 6,633.50
Unit value
Issuer Analysis
Its value
| Information as of July 31, 2001 | (Millions of pesos) | ||
| Its value | |||
| Growth indicators | |||
| Current quarter | Previous quarter | % variation | |
| Assets | 35,682 | 21,955 | 62.52% |
| Investments | 1,763 | 1,598 | 10.33% |
| TOTAL LIABILITIES | 17,836 | 6,188 | 188.24% |
| TOTAL ASSETS | 17,846 | 15,767 | 13.19% |
| OPERATING INCOME | 14,242 | 11,512 | 23.71% |
| OPERATING COSTS AND EXPENSES | 9,642 | 9,036 | 6.71% |
| OPERATIONAL UTILITY | 4.60 | 2.48 | 85.78% |
| PROFITS (SURPLUS) AND LOSSES | 1,969 | 1,366 | 44.14% |
It is clear that it is an excellent entity, its indicators demonstrate this. The point that should be analyzed is the high increase in liabilities, but this may be due to the greater collection of resources (CxP).
Profitability indicators.
| Asset profitability | Operating profit | 12.89% | |
| Total active | |||
| Return on equity | Net profit | 11.03% | |
| Heritage | |||
It is really positive that this entity is obtaining profitability levels close to market rates. Although, in this case the RP is less than the RA.
| Solvency | Heritage | 50.01% |
| Active |
This data shows us that the degree of capital response of the company is close to half the value of the assets.
Corporate image. (Taken from www.suvalor.com)
The company Suramericana de Valores SA, SUVALOR, was created in May 1991 in Medellín (Colombia) by companies with recognized leadership and experience in the financial, banking and insurance sectors. Currently, its main shareholders are companies of the Suramericana de Seguros Group: Corporación Financiera Nacional y Suramericana SA, CORFINSURA (94.5%) and Inversiones CFNS Ltda. (5.4%.)
A great support, several years of excellent results, a team of highly qualified people and a service-oriented philosophy, make SUVALOR a company with a projection in national and foreign markets.
Short-term credit quality rating: DP1 +, the highest rating. Virtually the risk of missing payment is nil.
Serfinco
Although all the issuers of securities must deliver their financial statements to the Superintendency of Securities, it was not possible to find this information to carry out the corresponding analyzes. However, we opted for this fund because of a high expectation of higher rates of return than that of other funds with similar characteristics.
Corporate image. (Taken from www.serfinco.com)
We have an impeccable 40-year history and a great service record, thanks to which our clients progress financially. We belong to the group of founders of the Medellín Stock Exchange
We offer high quality products and services through the development of specialized knowledge, extensive experience in this activity and a greater commitment to our clients.
STRENGTHS
- We have an important mix of our income, both by customer segment (natural persons, financial entities, business sector and public sector), and by products (Securities funds, fixed income, variable income).Most of our partners work in the same company, which guarantees stability in the work group and commitment to the development and good performance of the company in the long term. Being an independent company, we guarantee objectivity when making investment recommendations to our clients. Therefore, our only commitment is to them, not to the sale of products and securities of a certain financial group. We contribute to the progress of our clients as the only way to cement our own strengthening.We believe that innovation and technological support as well as the training of our staff are key factors in serving the community. We have made service excellence the basis for personalized attention. We have one of the highest rates of renewal in our industry. We have the privilege of serving and advising more than five thousand (5,000) clients. We are specialized in the natural persons segment as well as in companies in the real sector. Assets under our management exceed three hundred billion pesos (PS $ 300,000) million. During the previous year, we sold and purchased securities for more than three trillion pesos. We have 90 employees specially trained to serve and advise our clients.We have made excellence in service the basis for personalized attention. We have one of the highest renewal rates in our industry. We have the privilege of serving and advising more than five thousand (5,000) clients. We are specialized in the natural persons segment as well as in companies in the real sector. Assets under our management exceed three hundred billion pesos (PS $ 300,000) million. During the previous year, we sold and purchased securities for more than three trillion pesos. We have 90 employees specially trained to serve and advise our clients.We have made excellence in service the basis for personalized attention. We have one of the highest renewal rates in our industry. We have the privilege of serving and advising more than five thousand (5,000) clients. We are specialized in the natural persons segment as well as in companies in the real sector. Assets under our management exceed three hundred billion pesos (PS $ 300,000) million. During the previous year, we sold and purchased securities for more than three trillion pesos. We have 90 employees specially trained to serve and advise our clients.We have the privilege of serving and advising more than five thousand (5,000) clients. We are specialized in the natural persons segment as well as in companies in the real sector. Assets under our management exceed three hundred billion pesos (PS $ 300,000) million. During the previous year, we sold and purchased securities for more than three trillion pesos. We have 90 employees specially trained to serve and advise our clients.We have the privilege of serving and advising more than five thousand (5,000) clients. We are specialized in the natural persons segment as well as in companies in the real sector. Assets under our management exceed three hundred billion pesos (PS $ 300,000) million. During the previous year, we sold and purchased securities for more than three trillion pesos. We have 90 employees specially trained to serve and advise our clients.We have 90 employees specially trained to serve and advise our clients.We have 90 employees specially trained to serve and advise our clients.
Investment in dollars
The justification in this part of the work was taken into account when the investment strategy was defined. For this reason, only the amount to invest and the amount of dollars purchased will be stated.
TRM September 14, 2001 = 2,341.14
Value to invest = $ 32,000,000
Amount of dollars purchased = Value to invest = 13,668.56
TRM
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