World’s Largest Sovereign Wealth Fund Cuts (US) Treasury Holdings… But It’s Not What You Think
The headlines are running rampant this morning as the world’s largest (and most transparent) sovereign wealth fund – Norway’s Government Pension Fund – has proposed reducing the amount of government bonds in its $2.3 trillion portfolio to boost holdings of riskier debt, with US Treasuries the most affected.
So, with all that in mind – and while we are not used to being the calm kids in the theater when everyone is yelling ‘fire’ – Norway’s fund proposal is more portfolio engineering than a geopolitical “dump America” move (for now)…
Dollar weight in the bond benchmark barely moves: 52.9% ? 52.5%.