Tag Archives: risk

Oil fund down for the quarter (from the department of misleading headlines)

Again, I wonder, why is this newsworthy? 

The fund lost 7.7% in the 3rd quarter, while the “MSCI World Index fell 16 percent in the quarter and Europe’s Dow Jones Stoxx 600 Index slumped 12 percent.”

So, essentially the fund did a good job in a tough monetary environment.

Global fund to face losses for the year

My first reaction is, “and this is news?”

According to Morningstar, the Year-to-date total return for the S&P 500 is
-36.19%.  It would be extraordinary if the global fund did not face losses for the year.  Yet, Forbes still thought this was newsworthy.

Finance Minister Kristin Halvorsen explained:

‘This will be a hard year for the fund… this will be a year of losses, especially in the equity markets,’ she said in an interview posted on the BBC’s website on Monday.

‘Because we are very long term investors, we are not panicking, even if this is going to be a year of losses.’

Instead of focusing on the losses, the Norwegian people should see how the fund performed relative to major indices such as the S&P 500, the Dow, and or a European index

Losses are to be expected in some years.  The only question is whether the fund managers took unreasonable risks.  If not, this should not be newsworthy.