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2/28/2017, 11:58 AM (Source: TeleTrader)
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Norway's sovereign fund more than doubles gains

The Government Pension Fund Global, run by the government in Oslo, returned 6.9% or 447 billion kroner ($53.4 billion) last year, after 2.74% in 2015, helped by expansion after the victory of Donald Trump and the Republican Party in November 8 elections in the United States. The annual results published on Tuesday revealed profit from stocks came in at 8.7%, compared to 4.3% from fixed income and 0.8% earned in the real estate sector. The overall market value of assets rose from 7.48 to 7.51 trillion kroner ($900 billion), almost twice as much as in 2012.

The facility formerly known as the Government Petroleum Fund had 62.5% in equities, 34.3% in fixed income and 3.2% in real estate. "The return in 2016 was characterized by falling international interest rates in the first half, and strong equity markets in the second half. The year began with a downturn in financial markets, and uncertainty regarding developments in China," said Yngve Slyngstad, chief executive of Norges Bank Investment management. He explained markets priced in higher growth and inflation after the election in the US, boosting rates, the prices of oil and equities.

The fund, controlled by the central bank on behalf of the Ministry of Finance, is part of the Government Pension Fund of Norway. Last year investments in Europe were reduced by 2.1 percentage points to 36%, against an increase of 2.3 points to 42.3% held in North America. Argentina was included in the portfolio as the 77th country. The report notes the first ever withdrawal, of 101 billion kroner.

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