Three ways to get exposure to eastern Europe

published 27 March 2006

If you want to get in on the action in eastern Europe, you can do it via London-listed vehicles that have seasoned management, says KBC Peel Hunt analyst Dan Horwood in Shares magazine. And if you do, you can expect a dividend yield of nearly 10%.

Dawnay Day Carpathian (Aim:DDC, 115p), for example, is managed by venture capitalist Dawnay Day Europe, and has a "massive financial arsenal", which it plans to invest in shopping centres, supermarkets and retail warehouses in the region. Their fee is "performance based" and they aim to pay "an annual dividend of more than 10%, with compound returns of more than 25% a year on funds invested".

Black Sea Property Fund (Aim:BKSA, 26p) invests in holiday homes on Bulgaria's Black Sea coast, and hopes to exploit a bigger tourist market when the country joins the EU in 2007. The fund doesn't pay a dividend, but will wind up in 2012 and distribute its capital to shareholders.

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Also planning to benefit from an "influx of Scandinavian tourists", is Orchid Developments (Aim:OCH, 115p), which develops property and operates hotels in Varna and Sofia.

The share prices of all three firms could record returns in excess of 15% by the year's end, say analysts.

Charles has previously written for the MoneyWeek, giving readers his share tips regularly and covering other topics on the side such as stock markets and the economy. He has also written for The Business, Shares, Investors Chronicle and The Evening Standard, and Charles has presented on LBC and been a guest on BBC One and BBC World. Aside from his journalist background, Charles graduated as a chemist from the University of Oxford specialising in ligand gated ion channels.