Credit exposure was the largest contributor to returns during the month. This happened partly through the credit premiums which contributed to the current portfolio interest rate and partly through the movements in the credit spreads, which also had a positive impact. combined the credit spreads on the holdings in the sector, which benefited the fund because it corresponds to a rise in bond prices,” writes Ljungqvist. The fund’s credit duration fell to 3.3 years from 3.6 years, which means somewhat lower risk.
The interest duration was 0.77 years at the end of the month. The manager believes that the portfolio is still positioned for an environment where credit spreads will not increase dramatically and preferably stabilize, alternatively decrease.” The fund’s interest duration was at the end of the month at a moderate 0.77 then taken into account that the yield curve has a negative slope and therefore provides poor compensation for taking interest rate risk. In the last month, however, this negative slope has decreased in extent,” explains Ljungqvist. The largest holdings in the portfolio at the end of the month were Swedbank, Stadshypotek and 24Storage with portfolio weights of 8.65, 7.42 and 3.11 percent respectively.