As a long-term investor, I wonder how Nordea sold, or more accurately gave away “for free,” its holdings in its country fund, and which country will be zeroed out next…
Background
Russia invaded Ukraine, at which point the stock exchange closed. Nordea announced it would liquidate its fund as soon as possible because the companies it held were no longer being quoted. Now, just over six months later, the proceeds from the sale arrived in the account. The price tag was quite devastating; Nordea sold its holdings at a discount of well over 99% compared to the day before the invasion. So, someone bought shares from Nordea at a nearly 100% discount.
Future
Nordea, like others, has country funds in countries where things are currently heating up. Is it possible then that China will be “zeroed out” next, and then Japan? Why can’t Nordea freeze its portfolio and wait for, say, a 98% discount offer? What is the fund manager’s responsibility?
Signed, China and others for sale immediately
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At the moment, looking at the world, China definitely raises the most red flags (in addition to Russia), as it seems they’ve been living on borrowed time in many respects. Human rights issues should have led to a mass exodus long ago, but people chose to turn a blind eye to what China does domestically and, for example, to the Uighurs. Now they’ve taken the disturbance of Taiwan to the next level, and war is a real possibility in the near future. Also, the economy has its own major problems that are being authoritatively hidden, so there are plenty of red flags.
I wouldn’t put my cards too heavily on Saudi Arabia or India right now. India seems very interested in Russia’s cheap raw materials and less concerned about what Western countries think, and Pakistan also causes its own tensions there. Joint military exercises with Russia sounded really peculiar. Otherwise, I don’t know enough about India or Saudi Arabia, I’m just guessing.
Saudi Arabia: again, human rights issues are raising their head. This incredibly rich oil country has also shown that it doesn’t do charity with oil money, building cities and golf courses in the middle of the desert. Is it an ethical choice?
I try to avoid such countries with my stock picks and support Western domestic production. For example, it disgusted me that Saudi Arabia bought ESL (perhaps the most important tournament organizer for esports), and that ominously foreshadows the future. The Saudis know that oil won’t last forever, so they are extending their tentacles into other businesses to keep the euros coming from Western countries. I’ve lost faith that trade would lead to an improvement in justice issues even in Saudi Arabia; the super-rich elite just oppress others more and more.
Or am I already talking about the EU, heh. Well, let’s not go there.
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India and China; clearly for those who want excitement in their lives.
But how is it possible that a fund’s approximately 100 companies would be considered worthless in a so-called forced sale? Won’t this just result in a massive transfer of assets?
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