The Norwegian krone weakened slightly against the US dollar and strengthened slightly against the euro. Overall, exchange rate movements had a modest impact on returns this month.
The equity portfolio measured in local currency continued to develop favourably in October, and at regional level it was Asia and emerging markets that rose the most, followed by the US. The contribution from European equities was somewhat more subdued.
If we look at the sector level, there were some major contrasts in performance. Technology was by far the strongest sector this month, largely driven by strong sentiment for artificial intelligence companies. Shares in utilities and health care also contributed positively. Materials, finance and property stood out on the weak side.
The fixed income portfolio did little in October. As a benchmark, the S&P Global Developed Aggregate Bond (USD) index fell by 0.36 per cent. The 10-year interest rate in the US moved from 4.16 to 4.09 per cent. Due to the recent weakness in the US labour market, the US Federal Reserve cut its key interest rate by 0.25 percentage points in October, as expected.
The reporting season for companies' third quarters is drawing to a close and can be summarised as strong, especially in the US. After 90 per cent of the companies in the broad S&P 500 index have reported figures, we see that as many as 82 per cent have delivered better earnings (EPS) than expected. Earnings growth was 13 per cent compared to the third quarter of last year, and this is the fourth consecutive quarter of double-digit growth.
Forte Strategic aims to achieve a good risk-adjusted return, inspired by the Pension Fund's investment strategy. It is therefore relevant to compare the return between the two. The Pension Fund recently reported a return of 3.9 per cent in Norwegian kroner for the third quarter of 2025. This is on par with the return achieved by Forte Strategisk for the same period, and emphasises the fund's ability to deliver results in line with its strategy.
Sincerely yours,
Stein Frode Aaseng
