Finance Teach-in with Karin Thorburn: Sustainable objectives for the Norwegian sovereign wealth fund - Tues 10/4 at 11:30-12:30 in C210

We have the wonderful opportunity to hear from visiting professor Karin Thorburn on her work with the Norwegian sovereign wealth fund -- the largest in the world -- as Norway looks to the future sustainability of this fund and its national interests. Karin is a member of a nine-person taskforce that is due to present recommendations to the Norwegian government by mid-October. She will take us through the reasoning of the taskforce and discuss issues involved in managing such a large sovereign wealth fund.

Norway began in 1996 to save proceeds from the extraction of its enormous oil & gas resources. This fund now has assets under management of $900 billion, a whopping $200,000 per capita, in a democratic country with zero government debt. The purpose of the fund is three-fold: (i) to preserve the real value of national resources for future generations, (ii) to support government spending (the current takeout is 4% per year), and (iii) to serve as a countercyclical buffer, allowing for a government budget expansion in business cycle downturns.

The fund is currently invested 60% in publicly-listed equities (it owns approx. 2% of the world's market capitalization!), 35% in corporate and government bonds and 5% in unlisted real estate. At the end of 2015, the Norwegian government appointed this taskforce to review the strategic asset allocation of the fund. What mix of equities and bonds should the fund have? What is the risk-bearing ability of the fund in light of other national assets, like the right to tax? How do its three partially-opposing objectives influence the optimal risk-return tradeoff? What are the political risks associated with an aggressive investment strategy or unlisted assets?

Professor Thorburn is visiting Haas from the Norwegian School of Economics to pursue research and to teach the M&A course in our weekend MBA program.

RSVP below. Teach-ins are opportunities for students to share as well as to learn, so please come ready for broad participation and with questions. Or feel free to come just because this will be really interesting!

Teach-ins are brought to you jointly by the Haas Finance Group, Career Management Group and the MBA Finance and Investment Clubs.

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