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News and information about our funds and market commentaries.

  1. Adapting to reality shows

    While this is supposed to be a commentary on market developments in October, I have to address what everybody’s talking about these days: the US presidential election. At the time of writing this commentary, on the eve of the election, all available information points to a very close and extremely exciting race. As reality TV goes, it doesn’t get much better.

  2. Results from election meeting

    At the election meeting, held on 31 May 2024, one unitholder representative were re-elected to the board of Pareto Asset Management.

  3. The unforecastables

    At the first sign of increased geopolitical tension, energy prices tend to soar. The Yom Kippur war in 1973 gave us the first oil crisis. The Russian invasion of Ukraine in 2022 sent natural gas prices into the atmosphere. And now the Middle East is simmering just below the boiling point. So far, oil prices have risen by a moderate nine per cent and natural gas prices by roughly twice as much from their September lows, but energy experts warn they could go a lot higher.

  4. Cries of wolf fading – and now that’s a sign of wolf?

    As we enter September, the US yield curve is about to disinvert. For 26 months in a row, the yield on 2-year US Treasuries has exceeded the yield on 10-year US Treasuries, producing a negative term spread. Under normal circumstances, the yield curve is supposed to slope upwards, with higher yields on longer-term bonds. This would produce the classical risk premium required to take on the increased risk in longer-dated bonds.

  5. A Roosevelt moment

    July turned out to be a generally pleasant month, with falling interest rates and rising stock prices. The yield on 10-year US government bonds fell by as much as 32 basis points, whereas the MSCI World Index rose by 1.3% in local currency. Somewhat lower commodity prices, oil included, seemed to clear the way for further declines in inflation rates and a more dovish stance from the US Federal Reserve. In the US, where policy rates have yet to be cut, the headline inflation figure fell from 3.3% to 3.0%. In Norway, also waiting for the first cut, it fell from 3.0% to 2.6%.

  6. Investing in stride

    Here’s June 2024 for you: After heavy losses in European elections, French president Emmanuel Macron called for a surprising snap election, causing a spike in French government bond yields. The US announced new tariffs on a wide range of Chinese technology products, leading to retaliatory measures from China two days later. Trade talks broke down and further measures were announced.

  7. And it's no sacrifice

    In April, we hosted an institutional investor conference in Stockholm, with speakers and attendees from seven different countries. The title of the conference was “Pareto improvements in the agile Nordic markets”. Besides the obvious play on our company name, the title may need a bit of explanation for those who did not participate.

  8. Results from election meeting

    At the election meeting, held on 31 May 2024, one unitholder representative were re-elected to the board of Pareto Asset Management.

  9. Smoothing concerns

    May was certainly pleasant in the stock market. The S&P 500 rose by a full 5.0%, on renewed hopes of lower US inflation paving the way for earlier rate cuts. The MSCI World Index rose by 4.1% in local currency, reflecting a somewhat more restrained exuberance in other markets. Total return year to date, at 11.1%, is nevertheless in double-digit territory after just five months.

  10. Weep not for the exchange rate

    Out of curiosity, I asked ChatGPT to pinpoint the most unexpected turn of events in the financial markets in April. In fixed income, it pointed to the sharp rise in long-term bond yields, particularly in the U.S. Treasury market. I’m not sure if it was truly unexpected, but it was indeed sharp: The 10-year yield rose by 48 basis points, while the 2-year yield almost followed suit, at 41 basis points.