Many Russian banks offer their clients, along with deposits, additional tools for generating income. Some of them may be based on investing in real assets of businesses. Among them is the Alfa Finance program. What is its specificity? What profitability from participation in it can be expected?
Alfa Finance Overview
Alfa Finance is an investment program from Alfa Bank, initiated in 2010 and still open to the participation of depositors. It is more correct to write its name together - AlfaFinance, but in Russia a separate spelling has been established. What are the specifics of the respective initiative?
Judging by public information, through the Alfa Finance program, a bank with a consonant name attracts private funds to invest in the assets of real companies. This is probably their fundamental difference from mutual funds, where financial instruments can be, in particular, commodity and financial exchanges. Profitability from participation in the corresponding program could potentially be greater than when placing funds on bank deposits.
The wide geography of the presence of the Alfa Finance program can be noted: Voronezh, Yaroslavl, Moscow and other large cities have branches of the corresponding bank. There, investors can draw up their investment contracts.
Program benefits
The advantages of using a financial instrument such as Alfa Finance, the bank that initiated it, sees the following:
- the program guarantees the safety of depositors' funds, even if their total amount exceeds 1.4 million rubles (the state limit for the size of repayable deposits in the event of a bankruptcy of a credit institution);
- a private investor transfers resources to experienced financial professionals, but at the same time has the opportunity to participate in the selection of the optimal income generating tool;
- profits can reach about 25-30% per annum and even more.
The main element of the Alfa Finance program is an investment strategy. At the moment, the bank that has developed the appropriate financial instrument offers the client a choice of 7 such. Consider their specifics.
Strategy “Pharmaceutical companies”
This strategy, proposed by the Alfa-Finance program (reviews of many experts characterize it on the positive side), involves investing in the assets of enterprises manufacturing drugs. According to financiers, the relevant market segment is among the most promising, since the demand for high-quality medical products always remains stable. As part of the Alfa Finance program, it is planned to invest in shares of the world's leading pharmaceutical corporations. Among those:
- NOVARTIS.
- Novo Nordisk.
- Celgene.
- Gilead.
- SANOFI.
- GlaxoSmithKline.
What are they famous for?
NOVARTIS, according to some estimates, is the second largest pharmaceutical corporation in the world in terms of capitalization. Known for producing the popular TeraFlu, Tavegil, Fenistil, Lamizil drugs, the demand for which remains high in many countries of the world.
Novo Nordisk is known as the world's largest insulin producer. The Celgene brand produces drugs for the treatment of cancer and immune system problems. Gilead Corporation develops anti-HIV drugs. SANOFI produces the widest range of products, including Essentiale, Festal, Bronchicum, Magne B6, and Sofradex. GlaxoSmithKline brand produces vaccines, antiviral drugs - Panadol, Solpadein, as well as Coldrex.
Largest US Companies
Another strategy proposed within the framework of Alfa Finance investments (analysts' reviews also include a very positive assessment of it) is called "The Largest US Companies". The acquisition of assets of corporations included in the S&P 500 index, the total profitability of which amounts to trillions of dollars, is expected. Among such firms:
- Johnson & Johnson.
- Chevron.
- JPMorgan Chase.
- ExxonMobil.
- General Electric.
- Procter & Gamble.
Each of these brands is well known in Russia. Johnson & Johnson, as part of several large businesses, produces hygiene products, medical equipment, and medicines. Chevron Corporation is among the world's giants in the oil and gas industry. JPMorgan Chase Bank is characterized by excellent sustainability indicators, despite the instability that is observed in several segments of the global financial system. ExxonMobil, another energy giant, is one of the most expensive corporations in the world. General Electric is actively investing in promising businesses of its profile. Procter & Gamble Corporation holds about 25% of the global market in the segment of consumer goods.
"Innovative IT-companies"
Another noteworthy Alfa-Finance strategy (feedback from financial analysts regarding it is also very positive) - Innovative IT Companies. Investments in assets of the largest corporations are supposed:
- Apple.
- Google.
- Samsung.
- Microsoft.
- Yandex.
- Facebook.
Each of them, despite impressive momentum, has good potential for further growth, experts say. The shares of many companies on the list showed an annual growth of about 40-50%.
"Developing countries"
Another strategy proposed under the Alfa Finance program (investor reviews characterize it as one of the most promising) is “Developing countries”. It involves investments in the assets of enterprises operating in countries with growing markets. In particular:
- in Taiwan;
- in Hong Kong;
- in Mexico;
- in Malaysia;
- in South Africa;
- in Indonesia.
Many of the economies of these countries grow much faster than the economic systems of the most developed countries in the world. At the same time, they have all the necessary infrastructure and resources for further sustainable growth. Many global investors prefer to invest in business precisely in developing countries, where there are all prospects to achieve the highest profitability of enterprises.
"Consumer goods"
The strategy “Everyday Goods” offered to the participants of the Alfa Finance program may seem quite unusual. Moscow is among the leading economic centers of Europe, but even experienced metropolitan analysts note the originality of the concept proposed by Alfa-Bank.
The strategy in question involves investing in the assets of corporations that produce, in fact, those goods that are in demand by people almost every day: hygiene products, food, drinks. Among the leading players in this market segment:
- Nestle.
- McDonald's.
- Coca-Cola.
- Pfizer.
- Unilever.
- Colgate-Palmolive.
Demand for the products of these corporations remains stable, as well as the potential income of Alfa-Finance program participants.
Blue Chips
This strategy involves investing in the largest Russian corporations, which, in fact, are the locomotives of the national economy of the Russian Federation. Among those:
- NOVATEK, which operates in the oil and gas sector.
- LUKOIL, one of the most famous brands in the automotive fuel industry.
- Bashneft, another major oil corporation.
- Surgutneftegas is one of the leaders in the oil and gas market of the Russian Federation.
- EVRAZ, one of the world's largest steel producers.
- Polymetal is one of the world leaders in the extraction of gold, silver and copper.
Despite the current crisis in the Russian economy, these corporations remain stable. Investments in their assets, thus, can be characterized by good profitability. Many investors note that now, while the shares of leading Russian companies are relatively cheap, you can invest in them to get an excellent increase in capital upon the fact that the general stock market of the Russian Federation enters the path of sustainable growth.
"Precious metals"
Another strategy offered to Alfa-Finance program participants is “Precious Metals”. Thus, they will have to invest in them, or rather, in their market quotes. According to Alfa-Bank’s specialists, the advantage of investing in precious metals is their historical resistance to all kinds of crises. Despite the volatility of the respective quotes, gold, silver and platinum (the metals in which the investment is supposed to be) will always be in price due to the fact that their world reserves are limited and demand does not disappear. Precious metals, experts say, are protected from inflation and the effects of political instability. Analysts describe the corresponding strategy proposed by Alfa-Bank as one of the most balanced in terms of profitability and stability of assets that are the objects of investment.
Program ratings and reviews
How promising can investments be under the Alfa Finance program? Opinions on this subject are expressed by both participants and financial analysts. Assessments of citizens and representatives of the expert environment can be divided into those that:
- reflect the assessment of the prospects of investments;
- concern the quality of Alfa-Bank’s service in terms of communication with program customers;
- associated with the assessment, in fact, of the concept proposed by the financial institution, with the determination of the degree of trust in it.
As for the prospects of investments, citizens characterize the program as quite attractive. Many note that they considered participation in it not as the main method of generating income, but along with, for example, the placement of funds in bank deposits, since the profitability of the corresponding investments is comparable to that characterizing traditional deposits. Thus, it is completely impractical to take a loan to participate in the Alfa Finance program - its rates will be higher than the probable return on investments.
The quality of service of the relevant banking institution is evaluated by its customers quite positively. The hot line "Alfa Finance" is functioning, as citizens believe, correctly. It doesn’t matter in which city the brand is present. In fact, the geography of service under the program coincides with the one where the bank that initiated the Alfa Finance program is operating. In Taganrog, Voronezh, Yaroslavl - in those cities where the brand is present, you can become an investor. The quality of service is quite at the level, regardless of the actual geography of the bank. If the city in which the citizen invests as part of Alfa Finance is Voronezh, then there will be no problems getting the necessary information regarding this program, as well as when the investor is in Taganrog or Yaroslavl. Feedback difficulties are also not typical for communications between Alfa-Bank and customers. If a person wants to ask a question about the program that Alfa Finance Bank has established, the contacts of the nearest offices of the institution are always available online.
Reliability as the most important criterion
As for the evaluation of the concept proposed by Alfa-Bank, it seems quite promising to investors. Investments in the assets of real corporations or in precious metals are considered by many analysts as much more reliable ways of earning than, say, currency trading. Stability of income generation may predispose the stability, which is characterized by the bank that initiated the Alfa-Finance program. According to experts, the license was revoked from him, it just cannot be so, due to the fact that his financial stability indicators are among the most optimal in the Russian banking market. Alfa-Bank is one of the largest Russian credit organizations.