Kraft Nordic Bonds is now celebrating its second anniversary, and the first two years have been very eventful. With a Nordic mandate, the fund has navigated through a historic period characterised by the most aggressive central bank rate hiking cycle, persistent inflation and global geopolitical tensions.
Solid returns
Despite market turmoil and volatility, the fund has delivered a remarkable return of 30.58 per cent since inception, equivalent to an annual return of 14.29 per cent. The return has been achieved by investing in bonds issued by companies we consider to be of high quality, while we have been very active in portfolio management to optimise credit risk. In addition, we have placed great emphasis on maintaining a liquid portfolio.
Despite good returns so far this year, we have managed to maintain the effective interest rate at the same level as at the start of the year, at around 15 per cent. We have achieved this by investing in high-quality property companies with low loan-to-value ratios and other exciting opportunities. With an average maturity of approximately 3.75 years, the fund offers investors a rare opportunity to achieve equity market returns from the bond market.
Kraft Høyrente celebrates its 5th anniversary
The flagship Kraft Høyrente has returned 12.62 per cent so far this year, 17.79 per cent over the past 12 months and is up 54.15 per cent in total since inception.
The fund has witnessed both the market challenges of the pandemic and the historic cycle of interest rate hikes, yet the manager's philosophy has once again proven that a conservative stance and selective approach to investing works in practice.
The way forward
The funds' portfolios are highly liquid and consist of companies we expect to fulfil their interest rate obligations. Property is a key sector in the portfolios and has had a solid comeback in 2024, driven by a lower interest rate outlook. Demand for real estate bonds is high and we have good exposure to real estate companies with a conservative attitude and solid operations in both funds.
We cannot guarantee future returns, but we will continue to manage the portfolio in the same way as we have done for the past two years. We look forward to a good autumn season and expect high activity in the bond market.
We thank our investors for their trust and look forward to further co-operation. Kraft Fondene is dedicated to being a leading player in the industry, and we look forward to continuing our journey to deliver strong results in the future.
Below you will find more information material:
Kraft Fondenes market update July 2024
Øivind's interview in the financial newspaper
Kraft Nordic Bonds Monthly Report July 2024
Kraft Høyrente Monthly report July 2024
*Yield figures are as of 23 August 2024
*Effective interest rate and credit ratings are based on the previous month's report
*The effective interest rate may change from day to day and is therefore no guarantee of the return it is calculated for.
*Marketing. Remember that historical returns are no guarantee of future returns. There are risks associated with investing in funds. Before subscribing, you are encouraged to read the funds' key information and prospectus. You can find them on our website Kraftfondene.no