Issue 2, 2015


The Nordic Fund Selection Journal April/May 2015 issue discusses key themes impacting Nordic institutional investors, including challenges in real asset investing, pension fund mergers, and persistent gender inequality among leadership in asset owners. Many Nordic pension funds express concerns over crowded infrastructure markets leading to low yields and increased risk-taking, while cautious approaches to mergers and collaboration reflect differing governance views. Gender balance remains poor at CEO and CIO levels despite asset owners actively promoting gender diversity in investments.

Interviews with major Nordic players such as Varma’s CIO reveal strategic shifts towards equity and hedge funds amid low bond yields, with continued concerns over Finnish real estate exposure. Regulatory updates focus on the complex and delayed implementation of the Alternative Investment Fund Managers Directive (AIFMD) across Nordic countries, highlighting challenges fund managers face in compliance and supervisory readiness. The issue also explores evolving fixed income roles, emphasizing the need for more tactical, diversified strategies amid uncertain yield environments and shifting central bank policies.

The journal further profiles initiatives in real estate and forestry investments, highlighting efforts to balance yield with sustainability and diversification. Manager selection at Danske Capital stresses integrity and thorough qualitative assessments amid growing interest in boutique firms. Asset owners such as the Danish Lundbeck Foundation showcase how nimble, concentrated portfolios can outperform larger peers. The publication discusses the rise of sustainable investing at Storebrand Asset Management and sustainable income strategies using ETFs at BlackRock, while articles address practical investor-seller interactions and emerging trends like robo-advisory poised to transform Nordic distribution and advice models.

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Table of content

Introduction and Industry Overview

Insights into the Nordic fund management industry including challenges in infrastructure investments, the importance of economies of scale, and the growing interest in real assets like infrastructure, real estate, agriculture, and forestry.

Pension Fund Mergers and Collaborations

Discussion on recent mergers and attempted mergers among Nordic pension funds, highlighting organizational challenges, co-operation trends, efficiency gains, and the balance between scale and nimbleness.

Gender Inequality among Nordic Asset Owners

Analysis of gender diversity at the management and board levels in Nordic asset owners, conflicting practices regarding equality, and regulatory influences across Denmark, Finland, Norway, and Sweden.

US Equities and Value Investing

Overview of the optimism in US equity markets despite European quantitative easing, focus on value stocks, and the preference for active, value-led investment strategies in the US.

Income Investing and Risk Management

Changing landscape of income investing in a low interest rate environment, with strategies for balancing income needs with risk appetite through innovative and active approaches.

Nordic Pension Fund Asset Allocation and Gender Balance Data

Comparative statistics on asset owners in Norway, Finland, Denmark, and Sweden, their assets under management, gender composition on boards, and CEO roles.

Interview with Varma’s Chief Investment Officer Reima Rytsölä

A detailed discussion on Varma’s strategic shifts including increased equity and hedge fund allocations, concerns about Finnish real estate exposure, and evolving investment and risk management philosophies.

Regulatory Update: AIFMD Implementation in Nordic Countries

Exploration of the challenges and progress in implementing the Alternative Investment Fund Managers Directive (AIFMD) across Finland, Denmark, Norway, and Sweden, including supervisory issues and market impacts.

Real Assets Focus: Infrastructure Investment Trends

Analysis of the Nordic investor appetite for infrastructure assets amidst market crowding, low yields, risk of deviation from original fund plans, and varying investment strategies among pension funds.

Real Assets Focus: Forestry and Agriculture Investments

Case study on AP2’s agricultural and forestry investments, club-deal structures, diversification benefits, and responsible investment considerations.

Real Assets Focus: Real Estate Market Dynamics

Current enthusiasm for real estate investments in Nordic pension funds, valuation concerns, risk factors by country, and academic perspectives on real estate diversification and market interconnection.

Academic Insight: Real Estate Market Connectivity and Behavioural Finance

Research findings on real estate correlations with other asset classes, diminishing diversification benefits due to globalization, and the role of behavioural finance in market crises.

Swedish Local Government Pension Collaborations

Overview of collaborative structures among Swedish municipalities and counties for pension liabilities management, including joint funds, pension foundations, and subsidiary arrangements.

Roundtable: The Evolving Role of Fixed Income

Industry experts discuss changing fixed income market dynamics, portfolio allocation challenges, the impact of low yields and duration risk, tactical management, and role of currency and geopolitical risks.

Profile: Danske Capital’s Manager Selection Process

Insights into the qualitative and quantitative criteria for external manager selection with an emphasis on integrity, cultural fit, and portfolio manager expertise.

Profile: Storebrand Asset Management’s Sustainability and Product Strategy

Details on Storebrand’s responsible investment initiatives including green bonds, divestment from coal, sustainable smart-beta funds, and product offerings aligned with sustainability goals.

Profile: The Lundbeck Foundation’s Opportunistic Investment Approach

Discussion of the Foundation’s focused and concentrated portfolio, agility advantages as a smaller investor, thematic investments, and balanced approach to risk and return.

Do’s and Don’ts: Managing Communications with Nordic Investors

Guidance on preferred communication channels by Nordic investors, challenges with phone calls and emails, and suggested etiquette for establishing successful professional contacts.

Personal Profile: CIO Anders Schelde, Nordea Life & Pensions (Denmark)

An in-depth personal and professional profile highlighting his career, daily work habits, preferences, and insights into managing investments in a Nordic pension company.

News and Industry Updates

Briefs on gender equality initiatives in asset management, bond market outlooks, regulatory changes affecting distribution models, and upcoming Nordic asset management events.

Future Outlook: Distribution, Advice, and Robo-Advisors

Examines how regulation and technology (such as robo-advisors) are transforming the retail distribution and advisory landscape in Nordic asset management, with implications for product development and client engagement.

Upcoming Topics and Events

Preview of forthcoming magazine themes including infrastructure funds, activist investments, and foundation investing, plus a schedule of related industry roundtables and networking events.