Norway’s Government Pension Fund Global is the world’s largest sovereign wealth fund after posting strong growth of 10.4 percent in the latest year, according to Institutional Investor’s 2012 ranking of the world’s biggest sovereign funds.

The Norwegian fund had $612 billion in assets under management at the end of March, compared with $554.5 billion a year earlier, when it ranked second. The Abu Dhabi Investment Authority moves down one place to the No. 2 spot, after a change....