Market Comments - Q1 2022

Printfriendly PDF version

The first three months of the year saw a difficult start to the investment year 2022, with negative returns on most asset classes – including both global equities and Danish bonds. In other words, it has been a very difficult environment in which to generate positive portfolio returns for investors in the financial markets – also even though the equity market recovered over March.

The Omicron virus, which was the big issue and question at the beginning of 2022, has only to a moderate extent left its mark on the market in Q1 (hard lockdowns in large cities/harbours in China have, however, resulted in renewed pressure on the supply chains in March). On the other hand, the big topics in the financial market were the war in Ukraine and US monetary policy.

Russia’s invasion of Ukraine has left its mark on the financial markets with an increased geopolitical risk level. In other words, the markets focus on whether the conflict may spread to other countries. Moreover, the conflict results in an upward pressure on several types of commodities (of course oil and natural gas, in particular, but also several metals). This takes place at a time where several western countries are already struggling to limit the trend of rising prices at several levels.

As mentioned above, sanctions targeted at Russia led to rapidly rising commodity prices since Russia is a central country in relation to production of oil, gas, corn and selected base metals. The development in commodities has generated additional pressure on the trend in inflation which is in several countries at its highest level in years. In order to combat the trend in inflation, the Fed has hiked its interest rate for the first time since 2018 and simultaneously signalled a need for further tightening, which has maintained the pressure in the interest rate market.


The fund*



Latest quarter

-5,66 %

-5,00 %

-0,66 %


-5,66 %

-5,00 %

-0,66 %

* See past performance under the tab Past Performance

Right now
We anticipate that the market environment will in the coming quarter continue to be dominated by decreasing growth and prospects of monetary policy tightening which characterises the mature cyclical phase. This implies, therefore, that investors should still be prepared for the trend with market fluctuations and corrections, which we experienced in Q1, to continue in the coming period of time.

The trend in Q1 with continuously increasing interest rates and commodity prices, continued high inflation and lower growth indicators have become less supportive of risky assets for the long term. So far, however, we reiterate moderately higher exposure to equities and keep an eye on whether growth will slow down faster than expected, which will be bad news for equities.

Pay attention
Past performance is not a reliable indicator of future results. The value of and return on your investment may fall, and you may not get back the full amount invested. An initial charge is usually made when you purchase and sell units. The fund may invest in instruments denominated in various currencies. At least 75% of the fund assets will at all times be invested in EUR or hedged to EUR. You should be aware that changes in exchange rates may have an adverse effect on your investment. This may also be the case if EUR is not your base currency.
Information in this text should not be regarded as investment advice, and investors should consult their own investment and tax advisers before buying or selling.