Kraft Corporate Bonds gave a return of -2.59% in March and are up 10.54% over the past 12 months.

March was a turbulent month in the high-yield market. Geopolitical unrest and rising inflation expectations contributed to higher interest rates and increased credit spreads. Primary market activity slowed through the market turmoil, and investors became more selective and demanded better compensation for risk.

Premiums rose in the Nordic region, Europe and the US. The repricing of risk was a consequence of the war in the Middle East, which created increased uncertainty about energy supply and macroeconomic development. In periods like this, we distinguish between noise and substance. Price fluctuations are temporary, but an important part of the market. Systematic market turmoil creates new opportunities. We took the opportunity to increase positions in quality companies on attractive terms. We remain selective and trade where pricing provides good compensation for the risk we take.

We acquired the global automotive group Stellantis and the European satellite company SES. We consider the valuation to be attractive given the company’s market position and balance sheet strength.

We continue to focus on quality issuers to optimize risk-adjusted returns. The fund has strong capital discipline and an overall focus on quality to ensure liquidity, price risk correctly and safeguard unitholders’ capital.

At the end of the month, the fund had a current interest rate of 9.15%* and an effective interest rate of 11.53%*.

*Forcosts related to management. Will be subject to change from day to day, and is therefore no guarantee of the return in the period for which it is calculated.

Sincerely

Øivind Thorstensen & Simen Aarsland Øgreid