The fund

Managing risk for stable return in the Nordic credit market.

The fund

Arctic Return is a UCITS crossover credit fund that invests primarily in the Nordics. The investment objective is to achieve capital appreciation through investments in a diversified portfolio of bonds and money market instruments, with the Nordic bond market as the main market. We aim to build a corporate credit portfolio with a weighted average credit score of investment grade. We enhance yield by adding crossover bonds and selected non-investment grade bonds with short period to maturity. In the non-investment grade space we invest in a careful selection of issuers and in maturing bonds that have been refinanced. We believe this approach can provide attractive returns in relation to investment grade, while seeking to avoid the increasing risk of lower-rated high yield bonds. Key focus is high liquidity and low volatility for the fund as a whole. The fund managers have a strong track record and extensive experience.

The average modified duration of the Fund's portfolio of assets shall be within the range of 0 – 12 months. The average credit duration shall be within the range of 0-4 years.

The fund is a UCITS fund with daily liquidity.

 

The Nordic Credit Market

The Nordic region is a region with a strong legal framework, effective institutions. In general, there is also good corporate governance, which contributes to opportunities for good long-term returns.

Nordic ESG focus is ahead of other regions

E: Environmental

  • Clean air
  • Clean water
  • Pure nature
  • Renewable energy – water-/wind power
  • High focus on CO2 emissions

S: Social

  • High level of gender equality
  • Equal pay for equal work
  • 40% women in boards
  • Good protection for workers
  • High level of education
  • High employment participation

G: Governance

  • Democracy
  • Stable political systems
  • Geopolitically a stable part of the world
  • Good legal systems for companies and institutions
  • No acceptance for corruption

The relatively small, open and flexible economies we have in the Nordic region have provided a fruitful breeding ground for highly competitive companies with strong innovation capability and adaptability to new technology.

The Nordic credit market offers many investment opportunities across many sectors, which allows for good diversification. However, this requires that one must have resources and expertise on credit rating, as publicly approved credit rating agencies generally have little coverage in the Nordic market.

 

The Nordic Bond Market - Investment Grade

Source: Stamdata November 2020

 

Nordic AAA/AA/A bond universe approx. NOK17trn (USD2.2trn)

Source: Stamdata

 

Past performance in the fund is no guarantee for future returns. Future returns depend on the market, fund manager skill, fund risk level, costs, among others. Performance in the fund may at times be negative and may vary within periods.