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Neptune stars

The fast-growing Neptune Investment has, I believe, a higher percentage of four-star and five-star Standard & Poor’s ratings on its eligible funds than any other group. I have chosen as my top fund for 2007 its Russia and Greater Russia fund.

It has already had an outstanding performance, being up by well over 100 per cent since its launch two years ago and by over 43 per cent up over the past year to December 5, 2006. It was the top performer in the specialist sector since launch.

Fund manager Robin Geffen believes that this fund will again outperform and should be up by between 25 per cent and 35 per cent over this year. This is because he believes that growth in Russia has moved from being resource-driven to consumer-driven.

Accordingly, the fund has taken a lot of profits on its oil and gas shares and is now investing in consumer sectors, including the traditional areas such as retailers and breweries as well as financials and mobile telecoms.

Although there are parliamentary elections taking place in November and presidential elections early next year, when Mr Putin stands down, it is expected that the transition to the new parliament and president, likely to be one of the deputy prime ministers, will be smooth and uncontroversial.

The Russian economy is thriving, wages have grown by around 20 per cent a year for the past three years, inflation has remained low and there is a sense of optimism and prosperity among the well educated population of 150 million. The top 10 holdings include Efes Breweries, Rostelecom, Vimpel, Sberbank and Wimm-Bill-Dan Foods.

With Robin Geffen as its manager, this fund may well end the year at the top of the tree. Certainly, it is important that all growth portfolios should have an exposure to the Russian market.

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