First Investment Bank

Collective investments in transferable securities are:

Mutual funds are alternative for investment of available free cash funds. The client provides a certain amount of money by buying shares in the fund and the fund invests the money in different financial instruments. Mutual funds raise funds mainly from small, non-professional investors by investing them in different financial instruments. The risk in mutual funds is reduced also by creating a diversified portfolio of various financial instruments. Each investor, having bought shares in the fund, can sell them back when the net asset value of the company reaches 500 thousand BGN.

Index funds are a special type of investment schemes where a passive investment strategy is used in order to achieve a return on a certain index or market benchmark (a generally accepted market indicator). To avoid investing in each instrument, member of an index, for the investment purposes are used exchange-traded products on the underlying index such as ETF (exchange-traded funds), ETN, (exchange-traded notes), ETC (exchange-traded currencies/commodities).

Unlike mutual funds, the ETF (exchange-traded funds) have quotes throughout the entire session and their trading characteristics are similar to the ordinary shares. Most exchange-traded funds (ETF) reflect the movement of indices and sectors.

ETN (exchange-traded notes) are also traded on the leading stock exchanges and their performance is based on the market index after deducting the relevant expenses for management where no coupons are paid and the principal is not guaranteed. ETN reflect also the credit risk of the underlying asset, i.e. although there is no change in the underlying asset value, the increase in the credit risk can result into change in the ETN price.

ETC are just like the ETFs with the only difference that they reflect the movement of underlying assets as currency or commodity.

First Investment Bank offers:

• purchase and sale of stocks and shares of CIS traded on the regulated market (Bulgarian Stock Exchange JSC;
• purchase and sale of stocks and shares of CIS traded on the OTC market;
• purchase and sale of stocks and shares of CIS traded on foreign markets (regulated and OTC market);
• depository services.