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Waving the Flag

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Even as college campuses across the country are seeing petition drives asking colleges to divest from investments in companies that do business with Israel, a new fund going in the opposite direction has begun accepting investments. The Blue and White Fund invests exclusively in Israeli-based companies “that are publicly traded on principal U.S. stock exchanges . . . as well as the Tel Aviv Stock Exchange (TASE),” according to a prepared statement from the companies behind the fund. A long-term capital appreciation fund, Blue and White can invest 100% of its assets in Israeli companies traded in the U.S., but can also invest up to 25% in companies on the TASE. In contrast to most funds, it also has the option of going 100% to cash, something that fund chairman and CFO Shlomo Eplboim says may be useful in today’s market.

The Blue and White Fund trades across all market sectors and invests in companies of all sizes, says Eplboim. Israeli-based companies, he says, do 90% of their business overseas, and there’s a built-in benefit in that Israeli companies pay their expenses in shekels but earn dollars with their exports.

The fund’s investment strategy, says Eplboim, concentrates on Israeli companies that show “solid fundamentals, consistent, predictable earnings, effective management, and a global orientation.” According to Eplboim, the fund “provides an opportunity for investors to capitalize on the future growth of Israel through a diversified portfolio.” Eplboim also points out that Israeli exports have grown substantially over the past decade, “despite regional conflicts.”

Management advisor to the fund is Blue & White Investment Management, LLC which is owned 50% by RAMCO, a Tel Aviv-based investment bank that handles the actual investing, and 50% by Eplboim Poutre & Co., a boutique brokerage firm based in Los Angeles specializing in wealth management. It will go live January 31.