mast image

Special Report

Impact investing

Sections

Norway’s Nordic sovereign fund swelled by oil prices in first half

Norway’s domestically focused sovereign wealth fund posted a 4.3% investment return in the first six months of this year, boosted by rising oil prices.

The Government Pension Fund Norway (GPFN) – the sister fund to the country’s giant Government Pension Fund Global (GPFG) – added NOK10.4bn (€1.1bn) in the first half, meaning the fund’s total capital increased to NOK250.5bn at the end of June.

Folketrygdfondet, which manages the GPFN, reported that the fund returned 5.5% in the second quarter, beating its benchmark by 0.6 percentage points.

The 4.3% return for the whole of the January-to-June period was 0.8 percentage points above the benchmark, the Oslo-based manager said.

<

Acting CEO Lars Tronsgaard said: “First and foremost, it is the positive development on the equity market, driven by a high oil price, which contributed to the good result.”

Equities produced an 8.7% return in the second quarter for the GPFN, leading to a 7.2% return for the first half, while the bond portfolio generated 0.6% in the second quarter leaving it with a flat result for fixed income for the first half overall.

The first half returns for equities and bonds were 1% and 0.5% above their respective benchmark returns, Folketrygdfondet said.

The Oslo Stock Exchange’s All-Share index rose by 10.6% in the first six months of the year in local currency terms, with most of that gain coming in the second quarter. The Brent crude oil price rose by more than 19% in dollar terms in the same period.

As one of the world’s highest per-capita oil producing countries, Norway has a high proportion of oil and oil-related equities and bonds listed on its stockmarket.

In the other three countries where the fund can invest, however, Folketrygdfondet said equities rose just 0.9% in the three-month period in Norwegian krone terms.

The GPFN has a mandate to invest 85% of its portfolio in Norwegian assets and 15% in Denmark, Sweden and Finland. Asset allocation is split into 60% in equities and 40% in bonds.

Related images

  • ExxonMobil oil rig

Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2548

    Asset class: Fixed Income, Emerging Market Debt Hard Currency (Active).
    Asset region: Emerging Markets.
    Size: CHF 300-400m.
    Closing date: 2019-07-30.

  • QN-2549

    Asset class: Fixed Income, Emerging Market Debt Hard Currency (Passive or Passive Enhanced).
    Asset region: Emerging Markets.
    Size: CHF 300-700m.
    Closing date: 2019-07-30.

  • QN-2550

    Asset class: Fixed Income, Emerging Market Debt Local Currency (Active).
    Asset region: Emerging Markets.
    Size: CHF 250-350m.
    Closing date: 2019-07-31.

  • QN-2551

    Asset class: Fixed Income, Emerging Market Debt Local Currency (Passive or Passive Enhanced).
    Asset region: Emerging Markets.
    Size: CHF 250-350m.
    Closing date: 2019-07-31.

  • QN-2552

    Asset class: Fixed Income, High Yield (Active).
    Asset region: High Yield (US).
    Size: CHF 500-600m.
    Closing date: 2019-07-29.

  • QN-2553

    Asset class: Fixed Income, High Yield (Passive or Passive Enhanced).
    Asset region: High Yield (US).
    Size: CHF 500-1'100m.
    Closing date: 2019-07-29.

  • QN-2554

    Asset class: Global Real Estate (Equity, unlisted Funds).
    Asset region: World (ex-Switzerland).
    Size: CHF 200 mn (potential for further growth).
    Closing date: 2019-08-07.

  • QN-2555

    Asset class: Real Estate.
    Asset region: European.
    Size: EUR 50 - 100 million.
    Closing date: 2019-07-22.

  • QN-2556

    Asset class: FX Hedging.
    Asset region: Global.
    Size: Mandate size of CHF 1.5 bn.
    Closing date: 2019-08-09.

  • QN-2557

    Asset class: All/large Cap Equities.
    Asset region: China A-shares.
    Size: Unit linked platform (0m USD in initial investment).
    Closing date: 2019-08-01.

Begin Your Search Here
<