LHV World Equities Fund

For stock markets, October was a negative month as markets were under a selling pressure in anticipation of US presidential elections and investors were reducing risks entering November. Fund share decreased by 3% over the month.   Looking ahead, we do not think the presidential elections will considerably change out investment strategy as we have built our positions around long term trends. Politics is often overstated as stock prices are first and foremost driven by earnings.   In current environment we see opportunities in Scandinavian industrial enterprises, financial sector and in global commodity sector, in which we have taken new positions in. From commodity sector we purchased mining automation technology producers Epiroc and Metso Outetec stocks. As metal prices have gone up over the years, the mining sector investments have followed and we expect the mining technology producers to be the biggest beneficiaries.   Further, we purchased foresting machinery producer Ponsse and cellulose, packaging and paper sector technology producer Valmet stocks. Wood as renewable packaging material has attractive long term growth in which both companies thrive in.   From growth stocks we purchased Swedish medical technology producer Bactiguard stocks. The company is producing a special metal alloy which reduces the spread of bacteria on top of medical devices. It is a smaller company that offers very interesting long term potential.   In order to hedge risks, we took a position in gold miner AngloGold. We consider gold miners to offer good protection against central banks exceptional monetary policy and governments borrowing boom, which all have eventually created inflationary pressures in the economy.   By the end of October, the fund has invested 20% of its assets in global gold or copper related positions. Remaining has been invested mostly in Swedish and German medical technology sector, Finnish foresting sector, Nordic financial sector or Scandinavian domestic consumption-related single stocks. Cash makes up fifth of fund assets and we intend to invest it in commodity sector and in Scandinavian single stocks.