The world's largest wealth fund picked up $22 billion worth of stocks during 2018 rout

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A pedestrian passes the closed entrance to the headquarters of Norges Bank, also known as the central bank, in Oslo, Norway, on Wednesday, Oct. 29, 2014. 

Krister Soerboe/Bloomberg | Bloomberg | Getty Images

A pedestrian passes the closed entrance to the headquarters of Norges Bank, also known as the central bank, in Oslo, Norway, on Wednesday, Oct. 29, 2014. 

The world’s biggest sovereign wealth fund went on a stock buying spree during the market turmoil at the end of 2018.

Norges Bank, which manages Norway’s $1 trillion oil-funded wealth pot, said it bought 185 billion crowns ($21.7 billion) worth of equities, with the bulk of purchases coming in November and December.

The U.S. stock market had its worst December since the Great Depression as investors feared trade tensions with China and rate hikes by the Federal Reserve.

Despite the Norges Bank purchases, the fund’s overall market value dipped over the course of 2018 by 6.1 percent, marking a steep reverse from the 13.7 percent growth witnessed in 2017.

“This is the first time that the fund has had a considerable decline in value,” CEO Yngve Slyngstad told a news conference on Wednesday. “The only other time was a slight decline in 2002.”

The bank said the fund’s market value was $967 million at 31 December 2018. On the same day, 66.3 percent was invested in equities, 3 percent in unlisted real estate and 30.7 percent in fixed income.

In 2017, Norges Bank said it intended to raise its equity allocation over time to 70 percent.

During 2018, equity investments for the fund returned a loss of 9.5 percent, while unlisted real estate investments gained 7.5 percent, and fixed-income investments returned 0.6 percent.

At the end of 2018, the fund’s biggest equity holdings were in Microsoft ($7.5 billion), Apple ($7.3 billion), Alphabet ($6.7 billion), Amazon ($6.4 billion), Nestle ($6.3 billion) and Royal Dutch Shell ($6 billion).

After a strong start to 2019 for stocks, the Norges Bank website said the fund is currently valued at $1.03 trillion.

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