It is estimated that a third of the total capitalisation of the Warsaw stock exchange is held by overseas investors.
In terms of local fund promoters, Pioneer controls the market, with something like a 90% share of fund sales. Flemings has established a strong presence in the region, borne out in the top performance of its Luxembourg-based Eastern European fund. The group also has a specialist Poland Fund, as do Pioneer (the open-ended Pioneer Aggressive Investment Trust) and Foreign & Colonial (the Polish Investment Company Sicav). All three have beaten the local market benchmark in 1997.
Luca Parmeggiani, manager of Vontobel’s East European fund, which is second in the three-year Micropal performance rankings, is quite heavily exposed to Polish stocks. His weighting in Poland has been increased of late to 26% in anticipation of an improving macro picture which he expects to lead to positive growth earnings.
Lisa Riley at Schroders still has around 29% in Poland, but has reduced her weighting after earnings disappointments. Harold Gallob at Julius Baer does not think Poland offers good value as few companies are tradeable. Most of these are banks and he does not favour the banking sector in general. Stefan Bottcher at Flemings agrees, with Hungary emerging as the favourite of the central and eastern bunch.