Norway SWF Up, Cuts External Management


The Government Pension Fund gained 18% in Q3 while at the same time reducing its reliance on external managers.


(November 12, 2009) – The Norwegian sovereign wealth fund (SWF)—which holds 1% of the world’s equities—was up nearly 14% in the third quarter on the back of a global stock market surge.


The $455 billion Government Pension Fund gained 18% in equities and 7% in fixed income for the period between July and September, said the Norwegian central bank—which runs the fund via Norges Bank Investment Management. The fund’s managers beat their benchmarks in both equities (which comprise 62% of the portfolio) and fixed-income (38% of the portfolio). Equity outperformance was 0.2%; fixed-income outperformance was 3.3%.


These returns—the best in the fund’s history—are in addition to a $9 billion injection into the fund from the government in the third quarter.


The fund also reduced its reliance on external managers in Q3. As a result of poor performance in 2008, external equity management was reduced by $4.5 billion; external fixed-income management was reduced by $3.5 billion. The fund has no plans to hand out further external mandates in the near term.

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