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Norway's sovereign wealth fund posts loss in Q3

Xinhua, October 28, 2015 Adjust font size:

Norway's sovereign wealth fund posted a return of minus 4.9 percent, or a loss of 273 billion kroner (32 billion U.S. dollars), in the third quarter of 2015 due to global economic slowdown, the fund said on Wednesday.

Equity, fixed-income and real estate investments returned -8.6 percent, 0.9 percent and 3.0 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 negative return on equity investments was driven by the slowdown in the global economy and the decline in global equity markets, especially the Chinese market," 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.

"We have to expect fluctuations in the value of the fund when there are large movements in the market," Slyngstad said. "With the fund as big as it is today, this can have a considerable impact in the short term."

"The fund has a long-term horizon, however, and is in a good position to ride out short-term market volatility," he added.

The sovereign wealth fund had a market value of 7,019 billion kroner (824 billion U.S. dollars) on Sept. 30, of which 59.7 percent was invested in equities, 37.3 percent in fixed income and 3.0 percent in real estate.

The fund posted a return of minus 0.9 percent in the second quarter of 2015, the first negative quarterly return in three years. Endit