This is a marketing communication.
Before making any final investment decisions, please read the prospectus, its Annual Report, and the KID of the relevant Sub-Fund here. Note that the information below describes the share class (I SEK), which is a share class reserved for institutional investors. Investments in other share classes generally have other conditions regarding, among other things, fees, which affects the share class return. The information below regarding returns therefore differs from the returns in other share classes.
Coeli High Yield Opportunities (Class I) advanced by 0.13% during November. Since year-end, the NAV per share has consequently advanced by 3.94%. Since year-end, the NAV per share has consequently increased by 3.33%. The month turned out to be relatively weak for risky assets due to increasing concerns about possible investment bubbles in AI and the equity valuation of the large American tech companies. The fluctuations in equity markets were sometimes relatively large, during the last week investors regained courage and markets rebounded. The same pattern was seen in the corporate bond market, with initially widening credit spreads which then partially recovered. In the Nordics, the high activity in the primary market was somewhat dampened, repeat issuers still receive favourable terms, while inaugural issuers seem to have a little more difficulty finding financing.
After a record-long shutdown of the Federal state apparatus in the US, a budget agreement was finally reached in the middle of the month. As a result of the shutdown, several data points about the state of the American economy are missing. Before the upcoming rate decision from the Federal Reserve in December, the market seems to have taken note of certain signs of weakness from the household sector and therefore expects a further interest rate cut of 0.25 %-points.
Growth in Sweden for the third quarter was reported to be higher than expected, the development was supported both by rising household consumption and increased exports. The Economic Institute's Tendency Indicator for the state of the Swedish economy rose for the fifth month in a row, with the biggest improvement in the construction sector. The indications that growth in Sweden is on course to accelerate further before the new year were thus confirmed.
Among the main contributors in November was Flora Food Group, which made up for lost ground after presenting a decent quarterly report. Flora lost marginally in turnover, mainly in the US, but managed to defend its margins thanks to price increases. Financial companies generally performed strongly with good return contributions from SiriusPoint and Hoist Finance, among others. Hoist released a strong quarterly report at the end of the previous month, which included information on improved profitability and an investment portfolio that is growing in line with targets. The result was further supported by upgrades for Nordea and Fastpartner, whose respective ratings were raised by one step. Axactor also had its outlook raised to stable.
The biggest negative impact on the result was the property company Citycon after the main owner increased its ownership and announced that a bid will be made to buy the company out of the stock exchange. The fund actively traded Citycon bonds after the announcement, which helped to reduce the impact on earnings and reduce exposure to the company. Negative development was also seen for bonds from the installation company SPARC Group. The company's report for the third quarter showed good organic growth but with lower margins than expected.
During the month, new bonds from Protector Forsikring, Resurs Bank, NOBA Bank and SRV Group were added to the portfolio. Bonds from, among others, Hawk Infinity Software, SBAB Bank, ADDvise and Akelius Residential were divested.
