“Stock markets in the US, Europe and Asia moved up in lockstep in the quarter, driving the fund’s return,” says Yngve Slyngstad, chief executive officer of Norges Bank Investment Management (NBIM), which manages the fund.

Equity investments returned 11 percent and fixed-income investments returned 1.6 percent. The overall return was 0.3 percentage point higher than the return on the benchmark indices.

The fund’s investments in euro-denominated Greek government bonds were in March exchanged for new bonds issued by the Greek government and the European Financial Stability Facility (EFSF) as part of a restructuring of Greece’s debt. The fund sold its holdings of Portuguese and Irish government bonds in the quarter and reduced its investments in government debt from countries including Italy and Spain. It also bought government bonds issued in local currency in emerging markets such as Brazil, Mexico and India.

“Predictability is important for a long-term investor and the euro area faces considerable structural and monetary challenges,” says Slyngstad.

The market value of the fund rose 185 billion kroner to 3,496 billion kroner, helped by 60 billion kroner in new capital from the government. A strengthening of the krone against several major currencies reduced the market value by 110 billion kroner.

The fund held 60.7 percent in equities, 39 percent in fixed income and 0.3 percent in real estate at the end of the quarter.

• Quarterly report 1Q 2012. The Government Pension Fund Global (NBIM)