Norway’s sovereign wealth fund posted a negative return of 171 billion kroner (21.5 billion U.S. dollars) in the first quarter of 2018.
Equity, fixed-income and unlisted real estate investments returned -2.2 percent, -0.4 percent and 2.5 percent respectively in the quarter, according to a statement of the fund, formally known as the Government Pension Fund Global (GPFG) and ranked as the world’s biggest sovereign wealth fund.
The quarter was colored by increased volatility in global stock markets, the fund said.
“The most important expression of the risk in the fund is that the strategic equity share is set to 70 percent,” said Yngve Slyngstad, chief executive officer of Norges Bank Investment Management, which is the part of the Norwegian central bank that is responsible for managing the fund.
“This means that fluctuations in the fund’s value are predominantly determined by the development in global stock markets,” he said.
In the first quarter, 11 billion kroner was withdrawn from the fund. The krone appreciated against several of the main currencies during the quarter, which decreased the value of the fund by 183 billion kroner.
The fund had a market value of 8,124 billion kroner as at March 31 2018, of which 66.2 percent were invested in equities, 2.7 percent in unlisted real estate and 31.2 percent in fixed income, it said. (1 U.S. dollar=7.95 kroner)