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Norway Sovereign Wealth Fund Unveils "New Strategy" - Buy 5% Of Every European Stock

Tyler Durden's picture




 

Having learned last week that the world's central banks are their sovereign wealth proxies have secretly pumped over $29 trillion into markets in the last few years, it is not entirely surprising to hear from one of the largest - Norway $888 billion oil fund - that it is buying stocks with bond hands and feet. As The Financial Times reports, Yngve Slyngstad, chief executive of Norway's sovereign wealth fund, is hiring aggressively to manage its real estate portfolio and while the oil fund already owns 2.5% of every listed European company on average, it plans to go above 5%. Phew, bagholder found...

 

As The FT reports,

Yngve Slyngstad, chief executive of Norway's $888bn oil fund, emphasised that it was "continuation of the strategy" but with numerous small changes.

 

All are in the same direction: we are incorporating as distinguishing characteristics firstly that we are very long-term investors…and secondly the very large scale and size of the fund.

 

The fund expects the number of companies it owns more than 5 per cent in to rise from 45 to 100 by 2016 and Mr Slyngstad said "the majority of those will be in European companies".

 

The oil fund already owns 2.5 per cent of every listed European company on average but going above 5 per cent will see it step up its responsible investor role by talking to chairmen and boards more.

 

"Why 5 per cent? We have put up explicitly higher demands on us in an ownership role," Mr Slyngstad explained. But he argued this would not lead to the fund becoming an activist but rather merely a "responsible investor".

But it's real estate where they are growing...

Another change will be a "very rapid growth in the number of employees", as Mr Slyngstad terms it, going from 370 at the end of last year to 600 by 2016.

 

However, 200 of those will be in its property arm and given only 38 currently are Mr Slyngstad said the build-up in the rest of the fund is not too speedy.

 

All those people are needed in property as the fund is struggling to reach its target of having 5 per cent of its assets in real estate; it currently has 1.2 per cent.

 

"The growth we are foreseeing in the real estate portfolio is such that we will have to manage some of these properties ourselves."

So there it is - the marginal buyer of property and stocks around the world (most especially Europe) is none other than the high-price-of-oil beneficiary Norway sovereign wealth fund.

 

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Tue, 06/24/2014 - 18:10 | 4890987 logicalman
logicalman's picture

Swapping shit for oil???

Oil used to be called black gold - why not swap it for yellow gold?

 

Tue, 06/24/2014 - 18:18 | 4891010 Say What Again
Say What Again's picture

I hear that Cramer has a new show in Norway.

Mad Penger

Tue, 06/24/2014 - 19:16 | 4891226 max2205
max2205's picture

And they aren't even Japanese! 

Tue, 06/24/2014 - 22:28 | 4891871 tony wilson
tony wilson's picture

mot japan but connected.

japan went off track did not pay the rquired protection monies and got magna bsp nuked.

norway have been paying tribute protection monies for years the kiddy slaughter was a mossad hit and like all these things police military stand down.9 11,ukraine and today iraq for fuck sake.

the usa,city of london and israel all gain here.

buy are shit or isis come a knockin

Wed, 06/25/2014 - 03:25 | 4892276 BuddyEffed
BuddyEffed's picture

Looks like Norway is the new Belgium!

Tue, 06/24/2014 - 20:50 | 4891520 TheReplacement
TheReplacement's picture

What do they store that $888B in now?  How many dollars are going to come back on the market?

Tue, 06/24/2014 - 21:13 | 4891592 stoneworker
stoneworker's picture

I think it would be better to hold stocks rather than green paper when all of this goes falling down...however it is possible that a lot of companies will go bankrupt and stocks could lose their value as well, but the stocks of the companies that survive will probably be a good hedge against the coming inflation.

Tue, 06/24/2014 - 18:10 | 4890989 TeamDepends
TeamDepends's picture

Buy Jarl, buy!!!!

Tue, 06/24/2014 - 18:11 | 4890994 Recognizer
Recognizer's picture

Is anybody proof reading these articles today? Or is the editor out buying stocks with bond hands too.

Tue, 06/24/2014 - 18:49 | 4891136 swmnguy
swmnguy's picture

Both hands?  Bound hands?  Or maybe they really meant "Bond hands."  That's an interesting image, if I'm not sure what it's supposed to mean.

Tue, 06/24/2014 - 19:34 | 4891283 One of We
One of We's picture

Bond, James Bond....

Tue, 06/24/2014 - 18:13 | 4891003 F0ster
F0ster's picture

this is a robbery

Tue, 06/24/2014 - 18:14 | 4891008 Remington IV
Remington IV's picture

I need to sell my crap to someone

Tue, 06/24/2014 - 18:16 | 4891019 fonzannoon
fonzannoon's picture

even the oil guys are buying stawks, not gold. The bag holders are anyone sitting this one out. When the party ends they won't be rewarded. May as well jump in with some coke and hookers before the cops come.

Tue, 06/24/2014 - 18:27 | 4891061 Citxmech
Citxmech's picture

These companies are officially buying stocks.  I'd like to know what individual execs are doing under the radar, however. 

Tue, 06/24/2014 - 18:51 | 4891143 Hughing
Hughing's picture

Soveriegn ownership implies too big too decline; responsible ownership implies protecting nominial value of the assets. There is no fucking way, short zombie nuclear apocalypse, that TBTB will tolerate nominial declines. This shit must go up.

Tue, 06/24/2014 - 19:06 | 4891187 prains
prains's picture

that is exactly what Norway is saying......short a total dark ages melt down the global tribe of "central" wankers will only let this go in one direction. If the pin gets pulled look out plebeian tool, you will be pushed onto the grenade.....but you'll be flag draped and a flute will be playing somewhere.

Tue, 06/24/2014 - 19:36 | 4891292 One of We
One of We's picture

'Bout to stick my dick in the mashed potatoes!

Tue, 06/24/2014 - 18:18 | 4891027 post turtle saver
post turtle saver's picture

"buying stocks with bond hands and feet"

time to break out the shitgums and get this party started

Tue, 06/24/2014 - 18:19 | 4891030 NOTaREALmerican
NOTaREALmerican's picture

A continuation of the same strategy with numerous small changes.     Sounds like EYE-RACK.

I think I'll save that sentence for later.

Tue, 06/24/2014 - 19:18 | 4891232 max2205
max2205's picture

When will they twit that they bought 5 % of NFLX

Tue, 06/24/2014 - 18:20 | 4891036 GrinandBearit
GrinandBearit's picture

Norway Sovereign Wealth Fund = Winning!

Tue, 06/24/2014 - 18:21 | 4891038 Kreditanstalt
Kreditanstalt's picture

So what happens when 99% of every paper asset on the planet is owned (and never sold) by the same handful of banks, corporations and governments?

How do they plam to "make money"???  Trade them to one another??

Tue, 06/24/2014 - 18:24 | 4891046 NOTaREALmerican
NOTaREALmerican's picture

About 5 years ago, there was a "joke" going around about how the price of pigs could continue to go up if two farmers continued to buy and sell the same pig from/to each other.    Maybe there will be a sequel (for the joke). 

Tue, 06/24/2014 - 18:51 | 4891142 swmnguy
swmnguy's picture

Is that a joke?  I thought it was the whole operating mechanism of QE.

Tue, 06/24/2014 - 19:17 | 4891227 Kreditanstalt
Kreditanstalt's picture

"...how the price of pigs could continue to go up if two farmers continued to buy and sell the same pig from/to each other..."

Sounds like the COMEX "gold price"...!

Tue, 06/24/2014 - 18:29 | 4891066 tenpanhandle
tenpanhandle's picture

At this point in the ponzi, I think that making money is secondary to keeping money previously made fom turning to shit.

Tue, 06/24/2014 - 18:31 | 4891069 post turtle saver
post turtle saver's picture

I think you answered your own question... it's less about money and more about having a controlling interest... the key word being control...

Wed, 06/25/2014 - 15:31 | 4892625 SofaPapa
SofaPapa's picture

Exactly.  This is the enactment of a state-run economy.  The western governments outlasted the Soviet Union because broad-based private ownership is more flexible and responsive than state ownership.  The response of western governments?  Now that they are in trouble, they imitate Soviet style command and control.  First step, they take over the means of production.  We are going more USSR every day.  I was in Leningrad (now St. Petersburg) for a month near the end of the Soviet period.  Watching our "chosen ones" in every western government direct us into the exact system which was proven to create permanent economic depression is just so depressing.

Wed, 06/25/2014 - 06:32 | 4892386 tonyw
tonyw's picture

The plan is not to "make money" but to build up a fund for when the oil & gas revenues decrease.

Since Norway has a small population and large oil & gas income they very sensibly put surplus money into a fund instead of spending all of it on welfare projects, bridges to nowhere etc. From memory only a small percentage can be invested within Norway.

And not to be overlooked, it is in the interests of those people running the sovereign wealth fund for it to grow so their personal income & prestige grows:-)

 

Wed, 06/25/2014 - 10:17 | 4893100 astoriajoe
astoriajoe's picture

Its when they buy puts then decide to dump the shares on the market.

every day I feel like this is less and less something I want to be involved in.

Tue, 06/24/2014 - 18:31 | 4891071 phoolish
phoolish's picture

It's a phree Market.

Tue, 06/24/2014 - 18:35 | 4891086 starman
starman's picture

The world is for sale I mean for rent! 

Tue, 06/24/2014 - 18:37 | 4891092 falak pema
falak pema's picture

well you either hang separately or you go "all for one one for all" !

Capitalism has to be  rowing in the same direction to avoid the falls. Its a necessary condition but not a suffcient one.

For it to be sufficient it has to clean out the augean stables of the Oligarchy casino and its derivative soup and debt induced currency wars and race to bottom to save one at expense of other.
Even then it does not become sufficient if it does not change the whole "profit and waste" paradigm.

The financial thread has to be healed but it also has to serve a new deal, not that of fossil fuel bonanza and unlimited growth based on RM depletion and slave labour exploitation. 

Something that this Oligarchy is not prepared to contemplate. 

 

Tue, 06/24/2014 - 19:28 | 4891264 overmedicatedun...
overmedicatedundersexed's picture

Norway has found a quick way to make a billion dollar fund a million dollar fund..better they just take the money and find a deep hole.

Tue, 06/24/2014 - 18:45 | 4891109 Surging Chaos
Surging Chaos's picture

Haha, I can already see Norway being the next country in line to gorge on US Treasuries. That sovereign wealth fund money has to go somewhere.

Right Belgium?

Tue, 06/24/2014 - 18:54 | 4891152 BGO
BGO's picture

Don't fall for it, Norway! It's a trap!

Tue, 06/24/2014 - 19:02 | 4891163 JenkinsLane
JenkinsLane's picture

Here's an idea my Norwegian friends. Instead of buying stawks, why not buy enormous quantities of farmland instead?

Here's a clue as to why - Global population 1940, around 2 billion, global population now, around 7 billion. (Best check

these facts, this is off the top of my head.) Here's another clue - as BRIC, etc incomes rise, they add more protein to

their diets.

 

If, instead of buying financial assets the Norwegian Sovereign Wealth fund decided to become one of the largest

agribusinesses in the world, which it could easily do, the Norwegians would, ceteris paribus, be set for pretty much

ever.

 

Your welcome

Tue, 06/24/2014 - 19:06 | 4891191 NOTaREALmerican
NOTaREALmerican's picture

I think you need lots of armed thugs to hold the farmland after you buy it.   The natives get pissed.   The Norwegians gave up on exporting thugs a few centuries ago. 

Tue, 06/24/2014 - 19:23 | 4891244 kaiserhoff
kaiserhoff's picture

Easier said than done.  Farm land doesn't change hands often. about once every 50 years in the corn belt.  Even then, it is nearly always sold to a neighbor who is expanding.  That expansion in farm size has lasted 100 years, and counting.

You almost have to be born into it, and it's still a lot of risk, but worth it if it's in your blood.

Tue, 06/24/2014 - 19:31 | 4891274 One of We
One of We's picture

Snake eating its tail?

Dog chasing its tail?

Tue, 06/24/2014 - 19:32 | 4891275 Lmo Mutton
Lmo Mutton's picture

Uh, hello?  Vested interst.

Buy stocks prop up the companies that buy your oil.

 

Where my bonus @?

Tue, 06/24/2014 - 19:43 | 4891310 teslaberry
teslaberry's picture

1000 metric tons of gold is 50 billion dollars. if they plowed 500 billion dollars into gold they could buy 10,000 tons.

hahhahahahah. and germany is getting their gold back.......

you cannot buy gold anymore, at least not without severely disrupting the system, which norway, of all places is NOT going to do.

norway= nato = not part of europe historically nazi aligned meaning they ARE super UNITED STATES CLIENT STATE.

their military trains to attack/defend against russia. they have excellent weapons manufacturers.

if there is one country where the broader mass of people are SUPER LIBERAL compared to the historical core of the older dying minority---Norway is the best example.

when shit hits the stocks and bond yields shit ass to the moon, norways oil fund will regret their positions , perhaps they will even re-assess their liberal decisions to put women in positions of investing 1 trillion dollars.

a nationlist macho man would take at least 1/3 of that treasure and place it into a physical asset in possession by norway, or maybe try and purchase half of greenland from denmark or some shit. or get more submarines.

what the fuck ALL of your money into european held assets? show some pride in your own fucking country you norfuckers.

Tue, 06/24/2014 - 20:06 | 4891374 potato
potato's picture

We will file this one under "what-could-possibly-go-wrong" category.

Tue, 06/24/2014 - 20:08 | 4891381 buzzsaw99
buzzsaw99's picture

Phew, bagholder found...

Tue, 06/24/2014 - 20:50 | 4891518 logicalman
logicalman's picture

I guess blood-suckers will find a way to suck blood.

 

Tue, 06/24/2014 - 20:51 | 4891519 Handful of Dust
Handful of Dust's picture

You're safe as long as you can find a Bigger Sucker then you to dump on before the shit goes down. The EU just found their Suckka.

Tue, 06/24/2014 - 22:35 | 4891893 Mister Minsk
Mister Minsk's picture

Norweigan vikings are retards...

Wed, 06/25/2014 - 02:33 | 4892237 Jano
Jano's picture

Poor Norwegian blind man, he lost the stick and the dog run away.

Wed, 06/25/2014 - 02:41 | 4892239 Jano
Jano's picture

GS, Soros, BoA will understand, how to manipulate the market and siphone that money to the right pocket.

Reminds me of Gordon Brown, before selling the  physical Glod, announcing the terms of sales.......and achieving the worst possible price he could get.

Wed, 06/25/2014 - 04:37 | 4892313 Zwelgje
Zwelgje's picture

So the Norwegians are going to push up the real estate prices or at least keep them up?

How nice. 

Wed, 06/25/2014 - 05:22 | 4892343 john.smith
john.smith's picture

It is not just the Norweigians. I have had the opportunity to attend a few conferences with many international large sovereign wealth and pension fund proffessionals, and they are a very optimistic lot. While they all recognize that current economic conditions are abnormal, almost all believe things will improve and that there is good opportunity investing in the markets, which is why so many piled into the S&P in 2013, in the process giving each other high returns. Their bank handlers keep peddling bullshit to them (Last year it was the US's recovery and growth, this year its Europe's recovery), and many are all too happy to feed on it. If one were cynycial, he or she may conclude that western financial institutions are trying to move their bad assets to these funds, and will manipulate markets in collustion with Central Bankers in anyway to convince these wealth funds that the markets are healthy and that it is a good time to invest, so that in the end these funds would end up with a big portion of the losses when TSHTF.

Wed, 06/25/2014 - 08:02 | 4892490 JohninMK
JohninMK's picture

There are plenty of EU companies that are invested in farmland for them to buy shares in as well as some PM ones.

As Norway sells its oil/gas in US Dollars it needs to get rid of a large quantity of them, every month. Seems a very sensible move.

Dollars or shares for the future? Mmmmmmmm

Sat, 06/28/2014 - 06:08 | 4905049 Not Goldman Sachs
Not Goldman Sachs's picture

Bagholder?

Bagholders do not get bailed out....

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