The approach provides a Nordic/Global corporate credit exposure with low geopolitical risk and a sound ESG profile.
Pareto Bond Funds - Update
Markets have shown some optimism in January. Across bond markets, interest rates have gone down further. Credit spreads, already at historically very low levels, have compressed ever-so-slightly further. Consequently, bond investors had good reason to be happy with their performance. Portfolio performance should have typically come in slightly above yield carry, boosted by spread compression and duration.
The Swedish Riksbank has lowered its policy rate by 0.25% to 2.5% in January. It is thus ahead of the ECB, which kept its deposit rate at 3.0%. Norges Bank is pursuing a different path with its policy rate unchanged at 4.5%. NOK now shows a significant interest rate premium reflecting higher inflation expectations than its neighbors.
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