Investment philosophy

Investment philosophy

Our investment philosophy is to seek the best combination of quality and price. We do not buy a company just because we consider it excellent, nor do we buy a company just because it appears to be “cheap”. Our investment process is thorough and helps us find value-creating companies at a reasonable price, i.e. investment cases where we consider the risk/reward ratio to be compelling. The result of our process is an index independent and truly active equity fund.

The team has worked together for a long time and has a strong track record. It employs a disciplined investment process with a fundamental approach carrying out proprietary company analysis and industry research. We aim to have a genuinely collaborative environment with rigorous debate while recognizing the risks of behavioral biases.

A company analysis enables the team to assess a company’s business model, market position, product offering and growth opportunities as well as risks and ESG factors. We pay particular attention to downside risks, being operational or financial. To tie it all up we create our own estimates and target prices for the portfolio companies. After analyzing a company, we present and discuss the investment case with the team. The process represents a certain hurdle for new investments, which may make us miss some opportunities, on the other hand, we believe the process helps us avoid many loss-making investments.

Our investment horizon of typically 3-5 years allow the underlying values to be reflected in the market price. If value creation is good and pricing is reasonable, holding these companies give a good development in book value, earnings and dividend, which over time should be reflected in the market price. Arctic Norwegian Value Creation has delivered a clear outperformance on these three underlying value creation measures compared to the benchmark.

Arctic Norwegian Value Creation is research driven and truly index-independent UCITS fund. The investment process focus on identifying companies which are considered to be value-creating over time at a reasonable price. The portfolio is constructed by bottom up stock picking. There are no constraints regarding sectors and the goal is to achieve the best possible long-term risk-adjusted return. The funds benchmark is Oslo Stock Exchange Mutual Fund Index (OSEFX).

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.