New SOFAZ investments in shares will depend on global economy trends (Exclusive)
Baku, Azerbaijan, June 3
By Maksim Tsurkov – Trend:
Increase of investments of the State Oil Fund of Azerbaijan (SOFAZ) in the shares will depend, in particular, on the trends observed in the world economy, SOFAZ told Trend.
According to SOFAZ, as mentioned earlier, one of the main directions of SOFAZ's strategy is the creation of a fully diversified portfolio.
"Since 2012, SOFAZ has been investing in the global stock market, investing in highly diversified indices, which include various companies, countries and industries," SOFAZ said. "This process was implemented with the help of both external managers and SOFAZ’s specialists."
SOFAZ said that at the end of Q12018, 14.2 percent accounted for shares in the investment portfolio, while according to SOFAZ’s investment policy, up to 25 percent of the portfolio can be invested in the shares.
"In the future, new investments in shares will depend on the trends in the global economy, as well as the situation in the stock market, including expected returns, volatility and many other factors," SOFAZ said.
As of April 1, 2018, the SOFAZ investment portfolio totaled $37.63 billion or almost 100 percent of total amount of assets.
Moreover, 3.4 percent of SOFAZ investment portfolio has been placed in gold, 5.8 percent – in real estate, 14.2 percent – in shares, 76.6 percent – in bonds and other tools of monetary market.
As of April 1, 2018, SOFAZ’s assets increased by 5.1 percent as compared to early 2018 ($35.806 billion) and amounted to $37.631 billion.
SOFAZ was established in 1999 with assets of $271 million.
Based on SOFAZ's regulations, its funds may be used for construction and reconstruction of strategically important infrastructure facilities, as well as solving important national problems.
The main goals of the State Oil Fund include: accumulation of resources and placement of the fund's assets abroad in order to minimize the negative effect on the economy, the prevention of "Dutch disease" to some extent, promotion of resource accumulation for future generations and support of current social and economic processes in Azerbaijan.
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