Our weighted average return in July was +3.10%, bringing our year-to-date return to +11.86%.

During July we focused on analyzing corporate earnings releases. As a whole, the results were very impressive. As of the end of July 72% of S&P 500 companies beat their mean earnings per share (EPS) estimates and 70% beat their mean revenue estimates. These results were evidently very encouraging to equity investors. The S&P 500 ended the month up 1.95% and market volatility reached new lows.

Turning to the macro environment, the US central bank left rates on hold at the July meeting, citing lower than expected inflation levels. The European Central Bank also left interest rates unchanged and made no promises about upcoming stimulus tapering, despite increasingly positive Eurozone economic data. Positive Eurozone sentiment coupled with US political stalemates and chicanery (the failure of healthcare reform in Congress, the Trump investigation and a revolving door of senior White House staff…), pushed the US currency downward against the Euro, which gained 3.5% against the greenback during the past month. A lower US dollar should theoretically provide a boost to US exporters, and provide a headwind to international exporters to the US.

With the earnings season coming to an end, we see less catalysts in the foreseeable future, which could drive the already over-owned technology sector even higher. Keeping that in mind, we have sold the majority of our tech stocks and have been deploying capital to mining stocks. We have identified that the mining sector is incredibly under-owned and undervalued, especially when compared to the technology sector. This year’s P/E estimate for the global metals and mining sector is forecast at 13.39x vs. the 29.95x estimate for tech. It is also worth pointing out that the whole publicly traded metals mining sector is valued at roughly $823 billion, whereas the market capitalization of Apple alone is now $827 billion.

Please feel free to contact us at if you would like to hear more about our investment strategies.

On the behalf our portfolio management team, I thank you for your continued trust and support!

Pauls Miklaševičs

Important Legal Information

Nothing contained herein constitutes an offer, solicitation or recommendation regarding any investment product or service, or the offer to sell or the solicitation of an offer to buy any financial instrument; nor shall any such services be provided, or financial instruments be offered or sold, in any jurisdiction in which such an offer, solicitation, provision or sale would be unlawful. All content is subject to applicable statutes and regulations. Any potential investor should satisfy oneself that an investment in any product and/or service mentioned in this material is permissible under the rules and regulations of his or her domicile. This material is not directed to any person in any jurisdiction where (by reason of that person's nationality, residence or otherwise) the availability of the material is prohibited.

The information provided is for reference only and investors should determine for themselves whether a particular service or product is suitable and appropriate for their investment needs or should seek such professional advice for their particular situation. Please refer to offering documents for further information concerning specific products.

Certain statements contained herein may be statements of future expectations and other forward-looking statements that are based on current views and assumptions of BlueOrange (the trade name operated by the legal entity Baltikums Bank AS – hereinafter referred to as “BlueOrange”) and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. In addition to statements which are forward-looking by reason of context, the words “may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential, or continue” and similar expressions identify forward-looking statements. BlueOrange assumes no obligation to update any forward-looking information contained herein.


Past performance is no guarantee of future results. Investing in the financial markets is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk. Financial instruments may appreciate or depreciate in price owing to conditions, whether real or apparent, in a given market, economy or industry. The value of investments, and the income from them, can go down as well as up, and you may not recover the amount of your original investment. Where investments involve currency exposure, changes in rates of exchange may cause the value of the investment to go up or down. Any tax benefits referred to on this material are subject to change and their availability and value will depend on your individual circumstance.

No Reliance

Although BlueOrange has taken reasonable care to ensure that the information contained within this material is accurate, no representation or warranty (including liability towards third parties), expressed or implied, is made as to its accuracy, reliability or completeness by BlueOrange. Opinions and any other contents of the material are provided by BlueOrange for personal use and for tentative reference only. Nothing contained on this material constitutes investment, legal, tax or other advice and is not to be relied on in making an investment or other decision.

© 2017 Baltikums Bank AS (BlueOrange). All rights reserved.