The value of the oil fund exceeded 8,000 billion in the second quarter of 2017.
Measured in kroner, the half-year result was the best in the fund’s history.
The Government Pension Fund has seen four good quarters in a row globally, but this isn’t likely to continue warned the Deputy Chairman of the Petroleum Fund, Trond Grande.
‘We can’t expect such returns in the future. The record high yield is primarily due to the fund having become so big’, he said.
At the end of the second quarter, the market value increased by NOK 153 billion, to 8,020 billion. This is the first time that the fund has broken the 8,000 billion limit.
The return for the second quarter was 2.6%, which corresponded to 202 billion kroner. That is 0.3% higher than the benchmark return.
‘Special stock markets have delivered very well so far this year, and the fund’s return has been 6.5% for the first two quarters of the year. This is equivalent to a return of NOK 499 billion’, said Grande.
In the second quarter, NOK 16 billion was withdrawn from the fund. At the same time, the krone increased in value. This helped reduce the fund’s value by NOK 32 billion.
That the krone has appreciated further since the 30th of June means that the real market value of the fund on Tuesday morning was slightly below 8,000 billion, more specifically, NOK 7,702 billion.
Four per cent
The annual real returns since January the 1st, 1998 were 3.98%. Quarterly figures show that 65.1% of the fund is invested in equities, 32.4% in fixed income securities, and 2.5% in unlisted real estate.
At a press conference on Tuesday, Grande said that Britain’s Brexit negotiations with the EU didn’t affect oil fund investments to any significant extent.
He said that investment in real estate follows a ‘steady purchase rate’, to avoid peaks or troughs in the real estate market.
The Oil Fund had 6,818 who voted at the general meeting in the second quarter. The ownership power is used, among other things, to try to limit wage increases to CEOs in some companies’, said Grande.
© NTB Scanpix / Norway Today