How Norway’s sovereign fund dodges pitfalls in Asia

The world’s biggest sovereign wealth fund has obtained by far the biggest chunk of its excess return from emerging markets, and a major contributor to that has been its use of local asset managers for single-country mandates in countries such as China. Norway’s famously transparent $1 trillion oil fund, Norges Bank Investment Management (NBIM), has continuously adapted its approach to external managers since its inception in 1998, as it outlined in detail in a 164-page report last…