NORWAY - Norway's global pension fund, the largest equity investor in Europe, has no plans to buy commodities, according to its operator Norges Bank Investment Management (NBIM).
The NOK2.09trn (US$295bn) fund, which holds Norway's oil and gas revenue, is transferring money from fixed income to stocks and other investments in a bid to get higher returns. It's moving toward having 60% of its assets in equities, 35% in bonds and 5% in real estate, rather than 40% in equities and 60% in bonds. Just above 50% is currently invested in equities.
"We're taking a long time to increase our stake in equities. We're a large buyer in a market where it seems like there are more sellers," Slyngstad said. "We're not going to reduce our appetite for risk just because of volatility in the market."
The fund expects to start investing in property next year. "We have $20bn sitting on the sidelines waiting to go into the real-estate market, but we have no urgency to start," Slyngstad said. "We are more comfortable looking at the markets that are more transparent," he said, without specifying any.
Norway, the world's fifth-largest oil exporter, uses the fund to invest money outside the country to avoid stoking inflation. The fund is adding emerging markets such as Russia, India, China and Egypt to its investment horizon and is now allowed to take a stake of as much as 10% in individual companies, compared with 5% before, Slyngstad said, adding that the central bank had requested 15%.
NBIM, a unit of the central bank, runs the day-to-day operations of the fund, while the Ministry of Finance sets investment guidelines.
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