Henrik Stille’s Global Rates Opportunity Fund at Nordea Asset Management and Nicolai Rasmussen’s MIRA fund at Nykredit Bank delivered standout performance in 2025 by applying significant leverage to some of the safest debt markets, according to a report by Bloomberg.
The European fixed income hedge fund strategies returned 28% and 26%, respectively, placing both among the top-performing European-domiciled bond funds last year. The results are notable given their focus on covered bonds and highly rated sovereign debt, an area where unlevered returns were muted.
Both managers rely on relative-value strategies, exploiting pricing inefficiencies between similar instruments rather than directional bets on interest rates. Returns were amplified through the use of leverage of up to 10–15 times, allowing the funds to profit from modest spread movements between covered bonds, government bonds and interest-rate derivatives.
The performance stands in contrast to broader benchmarks. A Bloomberg index of euro-denominated covered bonds returned around 2%, while sovereign bonds gained roughly 1% over the same period. Despite this, the Nordea and Nykredit funds were among the only non-emerging-market strategies to break into the top ten European bond funds tracked by Morningstar Direct.
