23H·

How was my "Norwegian sovereign wealth fund" structured and why I rejected this idea?

Hello dear Getquiner,


after I explained in my last post why I changed my portfolio to a "60/30/10" portfolio, I would like to show you how my portfolio was structured before.


50% iShares Core MSCI World ETF $IWDA (+1.24%)

10% iShares Core MSCI EMU ETF $CSEMU (+1.84%)

3% Franklin FTSE Taiwan ETF $FLXT (+2.59%)

5% iShares Core MSCI EM IMI ETF $EIMI (+1.95%)

27% Amundi Index GBI Gbl Govies ETF DR $GGOV (+0.32%)

5% Amundi Index FTSE EPRA NAREIT Global ETF DRC $EPRA (+1.34%)


This structure should roughly replicate the Norwegian Government Fund by holding the respective asset classes as ETFs as a percentage of the real fund, the Taiwan ETF was an admixture, as I held a lot of Taiwan at the time, in the end it basically only contained equities. $TSM (+2.02%) I wouldn't do anything like that today. 😬


The idea behind it was that I would also be able to take advantage of the Norwegian sovereign wealth fund and at some point, like Norway, I would be able to withdraw 3% annually and it would be more crisis-proof than a 70/30 portfolio and have more emerging markets than an All World ETF.


If you want to know more about my new portfolio, check out my last posts where I explain the new allocation.


Now I'm looking forward to your opinion, feel free to write a comment and if you want to see more, leave a follow! 😁

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2 Comments

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I had the same thought once. But I came to the decision not to do it.
Unlike a state, you can have fluctuations. So 27% bonds really mess up your returns. That's a lot of money you're leaving behind in the long term.

The same with REITs, they don't rise as much, but they still fall with the entire stock market.
Norway has a high proportion because they have to reflect the global economy and real estate is a considerable proportion. As a private investor, you don't have to.

A 2 ETF solution like you already have with MSCI World and Emerging Markets is completely sufficient for a private investor. You will outperform the sovereign wealth fund. The latter slows down its returns through the bond block.

And you can easily sell 3% annually later on.
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@JBatelli Hey, top comment, but I have a 3 ETF solution 60/30/10 😅
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