Posted inNORDICS

swedes hedge their bets on europe

Something in the region of $25bn (€18bn) AUM was represented by figures such as Harry Nimmo, head of Standard Life Investments’ small cap teams; Wahid Chammas, head of Janus’ European equity strategy; Harry Clark, founder of Clark Capital in the US; Bastian Gries, head of credit at Meriten; and Craig Moran, who is deputy manager on several of M&G’s behavioural finance funds.

The one person who doesn’t manage money is Nicholas Brooks, who is head of research and investment strategy for ETF Securities – but the opinions of his team influence the decisions of all of the investors using his companies’ funds.alt=''

As a result of all this expertise, the topics covered were wide ranging and opinionated: there was a particularly interesting discussion on inflation/deflation – while two-thirds of the Swedes in the room think that deflation is really the worry, rather than inflation, the panellists had a substantially different view depending on the assets they manage.

When one delegate asked what the perfect inflation-proof company would be, Chammas pointed out that commodities companies would do well because of their relatively fixed cost base – so as inflation rose, so would their profits; while Nimmo mentioned that high quality companies might struggle because the environment would punish them.

Various other panellists also pointed out that while deflation was a risk, the obsessive determination of central banks to prevent Japanese-style deflation largely ignored the longer-term risks of high levels of inflation.

Demand for European long/short

Another point that stood out in the day was the attitude of the delegates towards European equities. Like many other countries, there is a trend towards overweighting Europe – but what is unusual is that the Swedish showed a strong preference for small caps and for value stocks, while in US equities, value is somewhat preferred – but the style choice is far less consensual.alt=''

Finally, there is yet more evidence that the readers of EIE are happy and comfortable with hedge fund investing. Two-fifths of the respondents would choose long/short as their primary route to access EU equities; only 20% would do that for US equities; 30% in emerging markets.

In historic terms, this is very high. It also links up to the attitude to absolute return products, which after a popularity dive last year are back up again; and the preference of 15% of the respondents to buy their fixed income in a hedge product.

Click here to see a slideshow of photos taken at Expert Investor Nordic.

Platinum members can additionally view a full breakdown of the event voting data here.

Dylan Emery

Dylan Emery is the group editorial director of Last Word. He is one of the founders of the company and he created International Adviser, Portfolio Adviser and Expert Investor. His primary responsibilities...

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