COVER STORY 7
„ In order to achieve diversification, we balance return drivers from a broad and diversified set of 20-30 risk premia. Asbjørn Trolle Hansen Head of the Multi Assets Team at Nordea Asset Management
respectively. This has now increased to 6.1% and 1.2% per annum. 3
Trolle Hansen is particularly optimistic regarding the exposure to Stable/Low Risk Equities, which have demonstrated an ability to perform through periods of heightened volatility – as well as periods of elevated inflation. “Equities offer the highest re- turn potential within a multi-asset strategy, but the asset class is also the greatest source of risk. There- fore, when we are composing our low-risk anomaly portfolio, we are seeking to identify companies displaying a greater degree of solidity in stock price, earnings, dividends, EBITDA and cash flow than the broader market,” Trolle Hansen explains. He is convinced that stable, high-quality and attractively valued companies, which historically offer more resilient earnings, are in a far better position to per- form well in this increasingly challenging economic setting. In addition, the team looks for compa- nies that exhibit pricing power and thus have the ability to pass on inflation price increases. This is a valuable characteristic in the current environment. “Finally, Stable/Low Risk Equities continue to offer a 1.5% earnings yield premium versus the broader market. This is an incredibly attractive building block for our portfolios in the months and years to come,” Trolle Hansen concludes.
ative impact was far greater in 2022, with treasury yields jumping 250bp and US stocks slumping 25%. While the magnitude of the market’s losses was far greater during this period, the constant refinement of the Multi Assets Team’s proprietary defensive alter- native risk premia over recent years kept drawdowns within the Alpha MA strategies to similar levels as the taper tantrum. The stage is set for the coming performance As central banks continue to raise interest rates to bring down inflation, sudden and abrupt discord in the markets will be recurrent for the foreseeable future – particularly as the war in Ukraine rages on. Despite these challenges, Trolle Hansen remains con- fident of the near and longer-term prospects of the Alpha MA portfolios. “The severe sell-off was largely a re-pricing of assets as a result of anticipated higher interest rates to control inflation,” Trolle Hansen says. “This has not significantly compromised earnings, balance sheets or default rates.” As a result, NAM’s Multi Assets Team is more enthusiastic about poten- tial investor returns. At the beginning of 2022, 10-year expected returns for equity beta and duration risk premia were 4.5% and 0.3% above cash per annum,
Nordea 1 – Alpha 7 MA Fund Base currency EUR
Launch date 23.05.2018 23.05.2018
ISIN LU1807426207 LU1807426629
Share class BP-EUR BI-EUR
Nordea 1 – Alpha 10 MA Fund Base currency EUR Share class BP-EUR BI-EUR Nordea 1 – Alpha 15 MA Fund Base currency EUR Share class BP-EUR BI-EUR
Launch date 30.09.2009 30.09.2009
ISIN LU0445386369 LU0445386955
Launch date 11.08.2011 15.06.2011
ISIN LU0607983896 LU0607983383
3 The presented figures are estimations of Nordea Investment Management AB Multi Assets Team and are based on assumptions and on information currently available. No guarantee can be given for the accuracy of the data and these estimations might not be met in the future.
ISSUE 02.2022
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