Things are quickly getting bad to worse for Mark Mobius, after getting demoted from the helm of the $2.9 billion Templeton Emerging Markets Investment Trust, he just got forced to shut down his Russia fund.
According to Bloomberg, Mobius’ 20-year old Templeton Russia and East European Fund has declined 38% over the past five years while its assets shrank nearly 85% from its October 2007 high of $394 million. It even traded at a 12% discount from its assets last week, underscoring just how bad things have become for it.
The 78-year old emerging markets guru meanwhile blamed Ukraine-linked sanctions as one of the reasons for the fund’s demise, saying that “the inability to invest in a number of companies” has been “a problem” for them. However, he was quick to point out that he was still invested in the country, adding “some of the oil and gas companies are very interesting, but most of them are subject to these limitations and constraints that we have, and we can’t buy.”
As for the fund’s main issue, this is what he had to say:
“The main problem was the size of the fund, not big enough to be profitable.”
Which is a little weird — every large AUM fund manager seems to wish that their funds were smaller so they could ramp up performance. I’m guessing he means fees here.
Either way, pending shareholder approval, the fund is set to be liquidated before the end of the year.
Photo: Marc Veraart