Norway's sovereign fund switching to liquidity

Oslo

NORWAY'S sovereign wealth fund proposed sweeping changes to its US$333 billion bond portfolio, including dropping the Japanese yen, emerging market and corporate bonds, as it beefs up on liquidity amid an expansion of its stock holdings.

The US$980 billion fund recommended paring its bond index from 23 currencies to only include securities denominated in dollars, euros and pounds, according to a letter sent to the Norwegian Finance Ministry. Emerging market and corporate debt should be removed but "systematic strategies" should be put in place to invest in these, it said.