Nordic green bonds – is it greener in the Nordics?
The Nordic capital market was early on putting sustainability and ethical investing high on the agenda. Especially large institutional Swedish investors have been driving the demand and other investors have followed. It is maybe not that surprising that the Nordic region played an important role in introducing green bonds in the global capital market.
After the Brexit vote, the Austrian, Eastern European and Italian elections, it is clear that the EU has some issues to tackle. European citizens are expressing their concerns. The question is if the remedies will be in place in time to avoid a too damaging blow to the union and the Euro (EUR) potentially through bigger anti-EU parties coming into power.
The Emerging European equity market has been underperforming the rest of the world so far in 2018. The sell-off started in late spring and the market fell significant. There has been only four other periods in the last 13 years when the Emerging European market has sold off more than 10% during a 2.5 month period.
As part of my job, I meet a lot of persons with whom I discuss investments and when we discuss Fixed Income, I realise that the word “yield” at times are used in a too simplistic way that can lead to non-optimal decisions. Therefore I’d like to highlight a couple of elements to keep in mind when discussing yields.
On April 6th USA launched personal sanctions against Russian oligarchs from a so-called “Kremlin list” in response to Russia´s alleged interference in the US 2016 presidential election. The sanctions are in part introduced to satisfy members of the congress who have put pressure on the administration to act.
What does global industrial heavy weights such as Atlas,Copco, Stora Enso and Volvo have in common? They are all born and raised in the Nordics! With 26 million inhabitants spread over five countries up north, the Nordics does not always stand out in a global perspective and the area is quite unknown to some.
The Nordics account for only 8% of Europe’s GDP and yet they have produced 50% of European billion dollar exits – also known as unicorns. Globally the Nordic countries have produced the most unicorns per capita after Silicon Valley. This is indicative of the Nordic region’s supportive startup environment, ease of doing business and availability of financing.
Last Sunday the recent presidential election took place in Russia and as forecasted the presiding president won by almost a landslide with 76.69% of captured votes. This is the highest number in Russian modern history as more than 55 million Russians voted for him and Putin will now be serving for another six years.
"...If this were true, it would imply that the neutral policy rate for Norway and Sweden would be higher than that for the eurozone, which in turn could lead these Nordic currencies to strengthen. Higher expected long-term growth and stronger currency indeed makes the Nordics an attractive environment for investors."
Investments in funds are always related to risk. Past performance is no guarantee of future results. Performances are calculated net of fees. Investments in funds are subject to market fluctuation and risks inherent in investing in securities. The value of investments and the revenue they generate can increase or decrease and it is possible that investors will not recover their initial investment.