After the Eurozone, US and UK, it's time to verify the Swedish marketplace where the SICAV-Optimize Invest Selection has exposure to stocks and bonds instruments.
Has mentioned in the launching of our first contract as advisors, the SICAV - Optimize Invest Selection is a balanced fund portfolio oriented for long-term savings composed of equity funds and bond funds. It is exposed to shares from the Eurozone countries, Switzerland; Sweden; Russia; United Kingdom; Japan and Canada.
The fund bears to European High Yield, US Dollar, American High Yield, Norwegian Krone, Swedish Krona and Japanese Yen in the bond component.
Perspectives
The Swedish economy started the pandemic as one of Europe's most dynamic supported by solid fundamentals, such as a budget surplus and a public debt below 40% against GDP. For its European counterparts, the economic impact felt differently in time (higher incidence in the second half of the year) as Sweden opted for a different approach to combating the pandemic by not adopting mandatory containment measures.
However, the pandemic crisis has significantly affected the country's finances, and the economy expects to contract by 4.7% in 2020 compared to the previous year. Nevertheless, the country's strong support measures and structural characteristics have helped mitigate the adverse effects.
While recovery is likely to begin this year, projections point to a 3.5% growth in 2021. The risks remain present. Indeed, the recovery can suffer delays due to a new wave of infections, virus mutations, or slower-than-expected vaccines' implantation.
In any case, the budget stance is appropriate, and there is room for additional support if recovery or inflation expectations fail and for the recalibration of the support measures. The Swedish Central Bank should also be ready to supplement budget support if necessary. Finally, the country also has the possibility of increasing its public expenditure to ensure economic growth.
Strategic allocation
Geographically, depending on the prospects and expected returns, the SICAV - Optimize Invest Selection portfolio has a 10% exposure to the Swedish market.
One crucial fact is that the Swedish krona is considerably undervalued concerning the euro. The Swedish Central Bank's monetary policy wants to perpetuate this reality, an additional resource for Swedish assets, which can be acquired at more attractive values.
We have a 5% equity position through ETF or mutual funds and a 5% bond position through ETF or mutual funds by asset classes.
To better understand the portfolio of funds or ETFs of shares and bonds, review our level 4 of the Money Framework series. We also made a video resuming the different steps to follow or evaluate the way that you manage the cycle of your income, savings and investments:
Embedded content: https://youtu.be/GCSRnsOTUdQ
When Euroconsumers Invest was born in June 2020, we presented ourselves with a clear purpose and well-defined objective: EUROCONSUMERS INVEST is a new Business to Business approach with a Business to Consumer DNA. We work with all entities and organisations that want to contribute to a more sustainable Financial market and empower all citizens.
The idea is to take, through work with companies, information and advice that would reach the largest number of consumers. Consumer organisations' experience is clear: there is a long way to help citizens' financial literacy.
In this sense, we disseminate the way we work and the basis of our analyses delivered to partners.
Definitions:
Mutual fund – A mutual fund is a professionally managed financial product – investment fund - that gathers money from many investors to buy securities: bonds, share or both. The advantage of this product compared to direct investment - direct purchase of shares or bonds - is that by joining many investors, the amounts available to invest considerably increase, which reduces costs and diversifies the investment (a more significant number of securities purchased).
This option is the most recommended for those who do not have much money (tens of euros are enough to invest), time to monitor the investment very regularly on a daily basis (there are fund managers who do this for you) and who have little knowledge of the financial markets.
ETF - An exchange-traded fund is an investment fund traded on the Stock Exchange as if it were a stock. An ETF can also be called an index fund. Most ETFs track an index, such as a stock index or bond index