Norway's US$1.9 trillion wealth fund returns 5.7% in H1
The US$1.9 trillion fund's return was led by equities, which rose by 6.7 per cent, Norges Bank Investment Management said in a report on Tuesday (Aug 12). The fund missed the benchmark it measures itself against by 5 basis points, it said.
'The result is driven by good returns in the stock market, particularly in the financial sector,' chief executive officer Nicolai Tangen said.
A stronger currency weighed on the fund, contributing to a drop in its overall value by 0.8 per cent to US$1.9 trillion.
Norway's wealth fund, the world's largest, owns about 1.5 per cent of listed stocks globally. More than two thirds of the fund is in equities, all outside of Norway. A big chunk of its holdings are in the US, including tech companies such as Apple, Microsoft, Nvidia, Alphabet, Amazon.com and Meta Platforms.
Founded in the early 1990s, NBIM invests the Nordic country's oil and gas revenues abroad for the benefit of future generations. It follows a benchmark index set by the finance ministry and has limited scope for active investing.
On equities, it tracks the FTSE Global All Cap index with holdings in about 8,700 listed companies in 44 countries, while the fixed-income portion of the fund follows Bloomberg Barclays indexes, with 70 per cent allocated to government bonds and 30 per cent to corporate securities.
The fund has been under pressure lately due to its investments in some companies contributing to Israel's war in Gaza and on Monday said it had divested from 11 Israeli companies. It's also terminating all contracts with external managers in Israel following public outcry. BLOOMBERG
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