Three CEFs to Help You Gain Exposure to Eastern European Growth

Today I'd like to provide three popular closed end funds which have underlaying assets mainly from Hungary, Czech Republic, Turkey, Poland and Russia. These CEFs are traded on the NYSE an are therefore accessible for U.S. investors.

1. Central Europe & Russia Fund CEF (CEE)
2. Templeton Russia & Eastern Europe Fund CEF (TRF)
3. Morgan Stanley Eastern Europe Fund Inc. (RNE)

CEE is diversified by many countries, but its holdings are mainly from the energy sector. TRF is almost only a Russian fund and is composed strongly of telecommunication companies. RNE also has a majority from Russia, but with a wide range of sectors. Only RNE currently has a share price ($40) below NAV (net assets value) of its holdings ($43).

1. Central Europe & Russia Fund CEF (CEE) - Its sponsor is DWS Scubber. Major holdings are Gazprom, Lukoil, Unified Energy, Sberbank, Bank Polska, CEZ, Bank Pekao, Erste Bank. 35% comes from 5he energy sector, 24% financial, 12% utilities, 11% material. Country diversification is as follows: 57% Russia, 18% Poland, 9% Turkey, 5% Czech Republic, 5% Austria.

CEE 1-yr chart:

2. Templeton Russia & Eastern Europe Fund CEF (TRF) - Its sponsor is Franklin Templeton Investments. Major holdings are Sberbank, Unified Energy, Lukoil, Mining & Metallurgical co Norilsk, Cherepovets MK Severstal, Volgatelecom. 22% comes from telecommunications, 21% material, 19% energy, 15% banking, 14% utilities. Country diversification is as follows: 93% Russia.

TRF 1-yr chart:

3. Morgan Stanley Eastern Europe Fund Inc. (RNE) - Its sponsor is Morgan Stanley. Major holdings are Sberbank, Unified Energy, Oao Gazprom, Mmc Norilsk Nickel, Lukoil, Wimm-Bill-Dann Foods Ojsc, Novatek Oao, Bank Millennium. 25% comes from banking, 13% oil and gas, 11% electric utilities, 10% media, 8% metals and mining, 7% food products. Country diversification is as follows: 67% Russia, 17% Poland, 7% Czech Republic.

RNE 1-yr chart:

Disclosure: none

Comments

[User Name]

You're mistaken about which funds trade at a discount to their NAV. CEE is trading at over a 13% discount to NAV, while RNE is only at a 7% discount to NAV. TRF is, however, trading at a premium to its NAV.