Government Pension Fund-Global, Oslo, returned 9.6% on investments in 2010, driven primarily by rising worldwide stock market values, the sovereign wealth fund reported on Friday.
Assets rose to 3.077 trillion Norwegian kroner ($552 billion) as of Dec. 31, up 16.6% from a year earlier.
The fund’s equity portfolio returned 13.3%, while bonds returned 4.1%.
The 2010 performance topped that of its custom benchmark by 1.1 percentage points. In 2009, the fund outperformed its benchmark by 4.1 percentage points.
Equities and bonds outperformed their respective benchmarks by 0.7 and 1.5 percentage points in 2010.
Equities and bonds made up 61.5% and 38.5% of total assets, respectively, vs. 62.4% for equities and 37.6% for bonds a year before. During 2010, 85% of cash inflows to the fund were invested in bonds to bring the mix closer to its target allocation of 60% equities, 35% to 40% bonds and up to 5% real estate. The fund’s first investment in real estate, a new asset class added in 2010, is expected to close this spring.
Inflows from the government’s sale of petroleum resources further boosted assets at the fund by 182 billion kroner, up from 169 billion kroner in inflows a year earlier.