The initial set of 2020 financial results from listed companies offers an opportunity to evaluate not just their performance but the strength – or otherwise – of their operational strategies. This is due to multiple considerations, most notably the exceptional situation created by the pandemic and the challenges – and opportunities – imposed on individual economies and the global economy as a whole.

What we see are some entities taking advantage of the crisis to turn in substantial profits, brought on due to changes in the pattern of commercial activities. There was also the emergence of newly listed companies whose services gained an immediate following.

Norway’s pension fund intelligently exploited the crisis to generate substantial returns, thus strengthening its position as the world’s largest sovereign fund. The fund achieved a 10.9 per cent profit growth to 101.5 billion euros – a sort of that is rare in such institutions. This has led the fund’s value to increase to 1.03 trillion euros ($1.250 trillion).

Change of direction

These results were made possible due to the fund’s active and professional investment policy, where it quickly picked up on the likely transformations brought on by the virus crisis. The fund exited from some activities and focussed on tech companies. Its exposure in stocks, including those of tech companies, made up 72.8 per cent of its investment portfolio.

Of the 9,200 companies it had exposures in, tech-focussed recorded the largest return of 41.9 per cent. The fund’s vigilance and realisation of the changes in the global economy – leading to heightened demand for e-commerce, distance learning and e-entertainment – will support Norway’s status as a premier welfare state that is also backed by ample oil wealth. (A large part of its oil revenues are allocated to investments in the fund.)

Read more @Gulf News