There are various types of possible AAA strategies in long-only and leveraged format to exploit in the Nordics. Looking back at historical risk and performance in those is certainly a part of an assessment process, even though history is no guarantee for the future. During the past 20 years, one can regard 2004 – 2013 as one type of era and 2014 – 2023 as another.
The first era was characterized by high (or normal) level of yields initially, followed by the transportation towards zero, and it contained two different types of crises (GFC and PIIGS). The second era also contained two crises (Covid-19 and Inflation) and was characterized by ultra low level of rates followed by an unprecedented sell-off.
The charts below look at the draw-down and accumulated period total return in Swedish Money market, Government bonds, Mortgage bonds, Nordic AAA Risk premia strategies (leveraged) and Nordic Macro Hedge fund strategies (leveraged). The charts speak for themselves on where to find superior long-term value and portfolio components!
