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In financial markets, the optimism of the past months lingers on. In January, benchmark yields on government bonds rose in many countries, particularly at the long end. A steeper yield curve typically signals faith in higher growth, so this is a double confirmation. Meanwhile, credit spreads fell, indicating a willingness to take on more risk. Many stock markets did end the month in negative territory, after mixed news on vaccine roll-outs, but the margins were small.

The IMF actually just raised its 2021 GDP growth forecast by 0.3 percentage points, although it felt obliged to emphasise the exceptional uncertainty. Curiously absent from the latest update, though, is a reference to the arguably temporary spike in the savings rate. In my mind, this is a powerful indication of the pent-up demand that may propel the economy forward once the pandemic is under control.

In Norway, the savings rate has tended to oscillate between 6 and 8 per cent. Now, Statistics Norway estimates last year's savings rate at almost 15 per cent. That's a lot of consumption waiting to happen!

Of course, we all tighten our purse strings in times of great uncertainty. That's why countercyclical fiscal policies were introduced in the first place. This time, though, there's a lot of purchases that we've been unable to make – like travel, dining out ... even visiting stores of all kinds. Don't tell me you'd like to keep up your newfound frugality once life returns to normal.

That, at least, is a message the financial markets don't believe in.

Fund updates for January 2021

Pareto Investment Fund
Pareto Investment Fund had a terrific start to the new year. During the month, the picture became somewhat more mixed; the fund ended up falling one per cent, similar to the benchmark index.


Pareto Aksje Norge
The new year started well for the portfolio, but market turmoil towards the end of the month contributed to January ending in the red, in line with the benchmark index.


Pareto Nordic Equity
The fund's assets fell marginally in a month with close to unchanged levels for the Nordic stock market.


Pareto Global 
So far in the reporting season, the portfolio companies' earnings have exceeded market expectations.


Pareto Nordic Return 
The new year started well for Pareto Nordic Return, but January did not quite hold up and the fund ended down by two per cent.


Pareto Nordic Alpha
As a consequence of strengthening the management team, we have acquired a number of new companies and made several changes to existing positions.


Pareto Nordic Omega
As a consequence of strengthening the management team, we have acquired a number of new companies and made several changes to existing positions.


Pareto Nordic Corporate Bond
The Nordic high-yield market has continued its positive momentum so far in 2021, with further spread tightening and good returns.


Pareto Nordic Cross Credit
January was another strong month for Pareto Nordic Cross Credit; performance was on a par with the last two months of the past year. The month was relatively active for the fund.


Pareto ESG Global Corporate Bond
The credit market saw a large number of bonds issued in both Europe and the US in January. The fund had another month of positive return.



Historical returns are no guarantee for future returns. Future returns will depend, inter alia, on, market developments, the portfolio manager's skill, the fund's risk profile, as well as fees for subscription, management and redemption. Returns may become negative as a result of negative price developments.

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