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The Latest Investment Trends in the Nordic Region


As 2018 is fast approaching, the following newsletter will highlight the discussions that the Kirstein team is currently having with investors in the Nordic region, and where we expect the focus to be in 2018.


Investor Types

Looking at the Nordic region, we have found it useful to distinguish between two groups of investors: those with rather innovative portfolios, and those with a more traditional asset allocation. We fully appreciate the fact that the world is rarely this binary, and we acknowledge that a wide grey area exists in the intersection between investor types. However, a clear conclusion has been that distinguishing between these two groups will be a more effective way of uncovering the market dynamics in the Nordic region.


Current Topics

Opportunities to generate yield across both listed and private market investments continue to heavily influence our strategy discussions with the Nordic investors. It is clear from our conversations that most of the investors’ time has been and will be spent on real asset investments, but also that the sentiment to move further out the complexity and illiquidity curve in credit is growing. The approach to the traditional asset classes within equity and fixed income seem unchanged, although the competition, in Finland and Denmark in particular, still forces investors to focus on reducing costs even further—a trend that in many cases has lead investors towards passive investments.

Another noteworthy topic this year was ESG. The tendency in 2017 was clearly that investors gradually move away from screening portfolios and into a world of ESG integration, and this trend has had a positive impact on the search activity in equity this year.

In the Nordic region, private debt allocations have increased significantly during the past couple of years, and they therefore contribute to investors’ increased attention to higher yielding asset classes. Senior bank loans have been a part of investors’ portfolios for quite some time, and the preferred approach is typically allocations to the US market, as opportunities in this space are regarded as more attractive than its European counterpart.

Within private debt, direct lending has continued to gain traction among investors. However, the surge in interest has to some extent led to challenges particularly in the upper market segment where leading investors prefer to engage due to available sizes and volumes. The risk/return relationship is therefore more attractive in the lower-mid market segment. The increased interest is also marked by the relatively large number of future mandates, which are primarily found among leading Danish and Norwegian investors.



As indicated by the above figure, future mandates in 2018 seems to be trending towards alternatives, with private equity and private debt being the top scores, but also more traditional asset classes like global equity and global emerging markets should continue to see a high degree of interest in 2018.

Time will tell whether these tendencies continue, but most things point in the direction of more investments in real assets and the ability and willingness to move further out the illiquidity curve. Should you have further interest in our findings please feel free to reach out to Jan Willers ( or Martin S. Nielsen (


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About Kirstein A/S

Kirstein A/S advises asset managers on how to strengthen their business and has consulted some of the largest Danish and international managers through more than a decade. We function as a strategic and operational partner, and our collaboration is customised to the needs of the individual manager. Our consultants are all investment professionals, and working with us means gaining access to direct and personal advice.

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