http://money.cnn.com/2017/09/19/investing/norway-pension-fund-trillion-dollars/index.html
Money quote (bold is mine):
"The fund is among the world's biggest investors in stocks, owning $667 billion worth of shares in over 9,000 companies globally. It owns on average 1.3% of all listed companies worldwide.
Its largest holdings are in Apple, Nestle, Royal Dutch Shell, Novartis, Microsoft, and Alphabet, the owner of Google.
The fund also owns large real estate portfolio, including stakes in buildings at the world's most desirable addresses, such as Times Square in New York, Regent Street in London, and Champs Elysees in Paris.
Returns have been impressive.
The fund has generated an annual return of 5.9 % since January 1998, a figure that is reduced to 4% when management costs and inflation are included. In 2016, it clocked a 6.9% return worth 447 billion Norwegian kroner ($57 billion)."
This year is shaping to be even more prosperous. The fund made 499 billion kroner ($63 billion) in just the first two quarters of 2017."
I went to http://www.moneychimp.com/features/market_cagr.htm and it says for S&P 500, from Jan 1 1998 to Dec 31 2016, the "average" return was 5.83% and "annualized return (=true CAGR)" = 4.21% (adjusted for inflation and including divdends).
So if I'm understanding these numbers right, they would have made 0.2% more annually buying an S&P 500 index fund from Vanguard. Which adds up to a lot.
I'm assuming the management cost of buying a single index fund is low, though may not be true for a government of course. However I am sure they have a very fancy team of high priced people investing these funds and underperforming the market. It's like how Harvard does the same thing with their endowment and can't beat an index fund either.
Money quote (bold is mine):
"The fund is among the world's biggest investors in stocks, owning $667 billion worth of shares in over 9,000 companies globally. It owns on average 1.3% of all listed companies worldwide.
Its largest holdings are in Apple, Nestle, Royal Dutch Shell, Novartis, Microsoft, and Alphabet, the owner of Google.
The fund also owns large real estate portfolio, including stakes in buildings at the world's most desirable addresses, such as Times Square in New York, Regent Street in London, and Champs Elysees in Paris.
Returns have been impressive.
The fund has generated an annual return of 5.9 % since January 1998, a figure that is reduced to 4% when management costs and inflation are included. In 2016, it clocked a 6.9% return worth 447 billion Norwegian kroner ($57 billion)."
This year is shaping to be even more prosperous. The fund made 499 billion kroner ($63 billion) in just the first two quarters of 2017."
I went to http://www.moneychimp.com/features/market_cagr.htm and it says for S&P 500, from Jan 1 1998 to Dec 31 2016, the "average" return was 5.83% and "annualized return (=true CAGR)" = 4.21% (adjusted for inflation and including divdends).
So if I'm understanding these numbers right, they would have made 0.2% more annually buying an S&P 500 index fund from Vanguard. Which adds up to a lot.
I'm assuming the management cost of buying a single index fund is low, though may not be true for a government of course. However I am sure they have a very fancy team of high priced people investing these funds and underperforming the market. It's like how Harvard does the same thing with their endowment and can't beat an index fund either.
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