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Background on Norway’s SWF Government Bond Index Shift to GDP Weights

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For nearly 40 years, bond indices have been employed for benchmarking public investor portfolios. The most widely used methodology has been one based on market capitalization. Norway’s Government Pension Fund Global (GPFG) modified their government bond index from a market capitalization-weighted index to one based on gross domestic product (GDP). Norway’s sovereign fund investment in government bonds is based according to the economic size of the target nation, measured by its GDP. Other investment factors include the country’s strength and stability of public finances. Executives at Norges Bank felt that a market capitalization-weighted benchmark for government bonds means an increase in the sovereign fund’s exposure to countries with growing national debt. Market-weighted benchmarks are still being applied for corporate bonds.

The bias on market capitalization-weighted government bond indices is that the most-indebted country gets the biggest weight.

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Blackstone Defeated on Investa Office Fund Bid

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The Blackstone Group threw in the towel on a bid to take over the Investa Office Fund, a vehicle that owns prized Australian office properties. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Temasek’s Bond Expected to Lure Retail Investors

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Singapore’s Temasek Holdings, through its subsidiary Temasek Financial (IV) Private Limited, is planning a 5-year bond that aims to yield 2.7% for retail investors. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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QIA Becomes the Largest Shareholder in Colonial

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The Qatar Investment Authority (QIA) became the biggest shareholder of Inmobiliaria Colonial, SOCIMI, S.A. (Colonial), a Spanish listed real estate company. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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