We asked two portfolio managers and a broker of they thought foreign investors are coming back to BSE. This is what they told us:

Nikola Tsonev, broker, EFG Securities

Between November and January foreign investors indeed withdrew a significant amount of capital from the stock market but that never meant they left. They rather cashed in their profits in order to ensure liquidity and to compensate losses they made on other markets.

We have to accept the fact that foreign investors are focusing primarily on their domestic markets and on other foreign stock exchanges, and BSE is not among their top priorities.

This means we can expect capital flows to renew when the global markets settled down. On the other hand, if the strain continues for a long period of time, investors may get too nervous and decide to bet on markets like ours. I myself, though, do not expect a lot of foreign interest in Bulgarian stocks before Q2.

Konstantin Abrashev, portfolio manager, BenchMark Asset Management

The low turnovers we saw in the past several week are a clear sign of the passiveness of institutional buyers, that including foreigners. It is too early to predict any market shifts or the return of foreign capital to the developing markets (including BSE).

The withdrawals of “hot cash” last autumn have hit the markets worldwide and we should first expects the global stock exchanges to recover. Only after that we may see more foreign capital coming to BSE.

Krasimir Atanasov, portfolio manager, Elana Trading

I don't think foreign investors are coming back. The global tendency right now is more like “let's wait and see what happens”.

There will be no major changes until global markets recover.