Kraft Nordic Bonds
The fund is managed by Øivind Thorstensen and Simen André Aarsland Øgreid (pictured), with a focus on credit risk within its mandate. We focus on companies with profitable business models, stable outlooks, and favorable conditions for the future.
Value Investing
The fund’s exposure to the bond market will primarily be achieved through direct investments in corporate bonds, government bonds, convertible bonds, and other debt securities. Regardless of credit rating, the manager will always make their own assessment of each investment. Investment choices will mainly be based on cash flow analysis and the companies’ balance sheets. The fund has no restrictions on the maturity of individual bonds or the portfolio as a whole. However, under normal market conditions, the fund intends to maintain an average maturity of around three years for the portfolio. The average duration will typically be under two years. Floating loans will minimize the fund’s interest rate risk.
Strategy – How to Generate Excess Returns?
Active portfolio management is the cornerstone in the pursuit of excess returns for the fund’s investors. As part of the portfolio management, a deep understanding of the loan documents and the structural aspects that can affect returns is crucial. This involves active portfolio repricing, either by arbitraging the yield curve of the issuer, where different loan maturities may be mispriced, or mispricing relative to comparable companies. Equally important is continuously repricing and changing the portfolio composition, whether the company’s performance over time is good or bad, and when market conditions change. Ultimately, effective portfolio management is based on the ability to take profits and losses when appropriate.
Our mandate
Kraft Nordic Bonds has a Nordic mandate where we can invest in all sectors and will seek a portfolio that represents a cross-section of the Nordic economy. The investment philosophy relies on fundamental company analysis along with related evaluations, including equity access, sector analysis, potential upside and downside, corporate governance, and ownership structure. The portfolio will typically consist of around 35-40 different investments and aims to achieve attractive geographic and sector diversification in the Nordic countries. The fund has a broad mandate with the possibility to hold various types of credit (convertible, hybrid, bond funds). The fund adheres to the rules of the Securities Funds Act for UCITS funds.
