Portfolio manager comments — Q2 2025
Fund performance was positive during the second quarter, rising by 5.5% in SEK, despite the Swedish krona strengthening against several of the region’s currencies. The best-performing markets were Greece, Hungary and Georgia, all of which rose by around 20%. The weakest performance came from Turkey, where the market declined by 7%. However, the fund’s Turkish holdings increased in value, thanks to a high exposure to banks that performed strongly.
One of the largest positive contributors was the Turkish bank Akbank. Banks in the Middle East, particularly Dubai Islamic Bank and Abu Dhabi Commercial Bank in the UAE, also contributed strongly to returns.
Overall, the banking sector was the strongest contributor during the quarter, which supported the fund’s focus on financial inclusion.
On the negative side was the South African pharmaceutical company Aspen, which lost a key customer in the vaccine segment. The company also revised its full-year guidance downward, leading to a sharp drop in its share price. As a result, we chose to reduce our exposure to the equity.
The telecom sector showed more positive development. Airtel Africa raised its earnings guidance, partly due to the ability to adjust prices upward to compensate for previous currency devaluations in several African countries.
Geopolitical tensions in regions such as Ukraine, Gaza and Iran negatively affected markets during parts of the quarter. However, markets have largely recovered as a degree of stability has returned. We hope for a gradual normalization of global market conditions and an end to the trade conflicts and tariffs that continue to affect the region.
The mining and gold-related equities, which were clear drivers in Q1, performed more in line with the broader market in Q2. These sectors continue to show high volatility.