To the investor,
As you know, there have been changes in the management department at Kraft Finans. Øivind Thorstensen has taken over the overall responsibility for the management of the Kraft Funds. Thorstensen will continue to be responsible for the management of Kraft Høyrente, but as head of asset management in Kraft Finans, he will also have a central role in the management of the equity fund Kraft Global and the various Aktiv Forvaltnings mandates.
He will share responsibility for equity management with yours truly. "For those of you who don't already know me, my name is Simen André Aarsland Øgreid. After working for several years in the asset management department at Kraft Finans, I'm looking forward to taking the step up as an equity manager.
"I'm very grateful for the trust I've been given and, not least, humbled by the task ahead of me.
In particular, I'm looking forward to working closely with Øivind Thorstensen, who has done an exemplary job over the past year managing the Kraft Høyrente high-interest fund. We have already worked closely together in recent months, and together we have developed a clear philosophy and strategy for Kraft Fondene, which will hopefully give you as customers good risk-adjusted returns over time.
Management strategy and philosophy
"The first thing we're going to do is streamline the philosophy in the asset management department. In other words, we will cultivate a management strategy that will be the cornerstone of both equity and fixed income management. There are essentially five main points that will be central to this management strategy.
- Long-term view
- Profitability
- Solidity
- Trend
- Momentum
Over time, these parameters should contribute to giving you as a customer a good risk-adjusted return.
For equity management, this means investing in companies that we believe have a product or service that will be in demand through every cycle. We want companies to have visible profitability, good cash flow, stable margins and be able to show growth. We want to take a long-term view of investments that extend five to ten years into the future. There will therefore be less focus on short-term noise and fluctuations in the market. History has shown us that share pricing is important in the short term, but over time it is earnings that are the main source of return.
Equity management will also reflect Kraft Fonden's basic philosophy that the portfolio should reflect a cross-section of the Norwegian core economy. We will therefore orientate the portfolio more towards the Nordic region, which is a market we know well. The exposure will still be global, but with a home ground advantage. This will also give us the opportunity to visit more of the companies, so that we can make a thorough assessment of the company management and ownership structure.
At the company level, we will look for companies that have a sufficient return on equity and invested capital, and that can also show growth and solid balance sheets. We believe that by focussing on companies that possess these qualities, we will be able to orientate the portfolio more towards long-term value creation and thus focus less on cyclical developments and short-term changes in cash flow.
Communication becomes important
All in all, we believe that a streamlined management philosophy in Kraft Fondene will result in a better product, which will also pull the management in a direction that suits you as a customer group. We are optimistic that over time this will have a positive impact on returns and perceived volatility in the portfolios.
If you have any questions or are wondering about other aspects of asset management, you're more than welcome to get in touch. I'm always available for a good investor chat.
You can reach me by phone, 995 58 222 or email, sogreid@kraftfinans.no
We're optimistic about the future and look forward to telling you about developments in the time to come!
Sincerely
Simen André Aarsland Øgreid
