Norway’s $570 billion sovereign wealth fund (SWF) has shed its entire holding of U.S. mortgage-backed securities as part of a change in its fixed-income portfolio, Bloomberg reports. The debt was issued mainly because of the refinancing risk.
The fund held $6.6 billion in bonds from Fannie Mae at the end of the second quarter and $2.08 billion from Freddie Mac in the beginning of 2011. The fund’s bond holdings returned 3.7 percent in the third quarter, helped by gains in German and U.S. government bonds. The fund’s securitized debt, which was 18 percent of the portfolio, increased 0.3 percent as calculated in international currencies.
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