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Portfolio Manager comment Coeli Likviditetsstrategi July 2020

Likviditetsstrategi advanced during July with 0.75 percent. Since year-end, the NAV per share has consequently decreased by 0.59 percent.

Credit management companies Intrum and B2 Holding were among the major contributors of the month. Intrum issued a reverse profit warning at the beginning of the month, with an operating profit that was almost 25 percent higher than previous guidance. B2 presented a brief update on the development during the quarter showing decent earnings development and reduced investments, which provides support for the company’s liquidity.

Bonds from the property developer Magnolia Bostad continued to develop strongly with the support of a strong quarterly report. During the second quarter, Magnolia sold just over two thousand apartments and as a result of the sales and redemption of a bond loan, the company’s adjusted indebtedness decreased significantly.

During the month, the fund participated in an offering from Intrum that issued bonds with the purpose of refinancing an existing bond loan maturing in 2022. In addition, two switches were carried out: longer bonds from both Samhällsbyggnadsbolaget i Norden and Mowi were exchanged to similar ones with shorter maturities. Except for the newly purchased bonds from Intrum, all holdings contributed positively to the month’s performance.

July offered relatively stable performance in the financial markets with overall rising stock prices and falling government bond yields. The price of gold rose significantly as the US dollar generally lost value against other currencies. Effects from the pandemic on the economic activity and the risk of a second wave continues to dominate the news flow. As expected, statistics on GDP development in the developed economies offered gloomy reading with reported declines in economic activity of almost 10 percent in the US and about 12 percent in the Eurozone.

The development in the corporate bond market was generally positive with tighter credit spreads in both the investment grade and high yield segments. In the Nordic market, activity was low with only a few transactions due to the reporting period and summer holidays.

Both the ECB and the Federal Reserve left their key interest rates unchanged during the month, asset purchase programs were also left unchanged. Representatives of the two central banks emphasized the importance of monetary policy being supplemented by extensive fiscal stimulus to support the economies. The Riksbank also decided to leave its key interest rate unchanged, the forecast for the repo rate now indicates an unchanged interest rate for at least the third quarter of 2023. The Riksbank’s program for bond purchases was increased to SEK 500 billion and extended by six months until mid-2021. Further, it was announced that investment grade corporate bonds will be eligible for the program from September and onwards.

Coeli Likviditetsstrategi

Performance in Share Class Currency 1 Mth YTD 3 yrs Since incep
Coeli Likviditetsstrategi 0.75% -0.58% 2.54% 21.59%
Benchmark -0.01% -0.14% -1.81% 1.24%

Gustav Fransson

Portfolio Manager of Coeli Likviditetsstrategi

Alexander Larsson Vahlman

Senior Analyst

Fund Overview
Inception Date 2010-05-01
Management Fee 0 %
Performance Fee Yes
Risk category 2 of 7
Top Holdings (%)
WHITE MOUNT FRN 17-22.09.47 3.6%
PANDOX AB 0% 20-20.08.20 CP 3.3%
AMBEA 0% 19-14.10.20 CP 3.2%
NORD ENTMT 0% 20-18.11.20 CP 3.2%
LANSBK 1.25% 16-20.09.23 2.9%

DISCLAIMER. The information provided here does not constitute professional financial advice. Past performance is not a guarantee of future returns. The price of the investment may go up or down and an investor may not get back the amount originally invested. The key investor information document (KIID) and prospectus are available at www.coeli.se.