Market development

2025 was a strong year for most asset classes. MSCI World returned 21.1 percent in USD in 2025. This marked the third consecutive year of double-digit growth for MSCI World. While performance has been strong, it is not unique. For comparison, MSCI World posted double-digit annual returns for five consecutive years in both the late 1990s and the late 1980s. 

In 2025, markets defied tariff shocks, geopolitical tensions, concerns about U.S. debt levels, a U.S. government shutdown, and growing concerns about an AI bubble. The best-performing sectors were Communication Services, up 32 percent and Financials, which returned 28.7 percent. Consumer stocks had the weakest performance, rising approximately 8.5 percent. 

2025 differed from many previous years in which the U.S. equity market led performance. In 2025, other regions generated the highest returns. The S&P 500 rose 17.9 percent. The Magnificent 7 stocks once again outperformed the broader market in 2025, and the ten largest companies in the S&P 500 rose 25.8 percent. An equal-weighted index returned 10.8 percent, illustrating that not all companies contributed equally to market returns. 

The broad Asian equity market (MSCI AC Asia ex. Japan) ended the year up 32.3 percent . AI-related technology companies such as Samsung and platform companies like Alibaba stood out in particular. The European equity market ended the year up 19.4 percent, with financial stocks—especially banks—delivering another strong year. The weakening of the U.S. dollar contributed to European equity returns measured in USD reaching as high as 35.4 percent. Bank stocks rose 76 percent (USD) and have now increased 131 percent over the past two years. This makes them a rare group of stocks that have outperformed the Magnificent 7, which have risen 108 percent over the same period. The industrial sector and defense stocks also performed strongly in Europe. The Oslo Stock Exchange ended the year strongly, rising 4.9 percent in December and 18.4 percent for the year overall. 

The U.S. dollar index weakened during 2025, with most of the depreciation occurring in the first half of the year. The Norwegian krone strengthened by 12.9 percent  against the USD, offsetting much of the gains in global equities for a Norwegian investor. Measured in Norwegian kroner, MSCI World rose 7.3 percent. Gold prices continued to increase throughout the year for a total increase of 65 percent for the year. Drivers of the increase included central banks increasing their gold holdings, inflation concerns, debt concerns, and gold’s role as a “safe haven.” 

Inflation in the U.S. continued to decline during 2025 and ended the year at 2.7 percent, still slightly above the 2 percent target. However, increased uncertainty around the U.S. labor market led the Federal Reserve to cut rates twice during the year, which was also the expectation at the beginning of the year. In Norway, rates were cut twice, while the projected rate path was revised upward during the year as inflation remained well above target. Following two rate cuts by the ECB in 2025, the policy rate is now down to 2 percent, and with inflation nearing 2 percent, it is expected that the ECB has completed its rate-cutting cycle. 

Activity and results

The business area generated a return of 16.3 percent in USD in 2025. Due to the significant dollar weakening and further strengthening of the Norwegian krone, the return measured in NOK was 3.3 percent.

The business area manages two mandates: Global Equity and Global Fund Opportunities. The purpose of the Global Equity mandate is to invest in attractive markets through equity funds that complement Ferd’s direct investments. The mandate consists of the five themes The Climate Transition (20 percent of capital at year-end), US Centric (23 percent), Asia (16 percent), Technology (21 percent) and Europe (20 percent). The latter was established as a new theme in 2025. 

The Global Equity mandate returned 19 percent in USD. After weak performance in the previous couple of years, both Asia and the Climate Transition themes had a strong year, returning 27.8 percent and 22.9 percent, respectively. 

The Asia theme delivered strong returns across many sectors, with AI-related companies—both semiconductor and platform companies—standing out. The theme also benefited from investments related to gold. Significant changes were made to the manager composition during 2025, which contributed positively to performance in the latter part of the year. The investment theme maintained a somewhat lower weighting in IT companies than the broader market, which detracted from relative performance. 

Within the Climate Transition, investments related to energy transition were the primary driver of returns in 2025. These investments account for 80 percent of the theme’s capital and rose 31 percent. During the year, markets increasingly focused on the increased power demand from the data center build-out, in addition to ongoing electrification of society. This contributed to strong performance among companies involved in power generation, power infrastructure, power supply, and equipment manufacturing. Some sub-segments also recovered from a weak period prior to 2025. Together with reduced regulatory risk following the passage of OBBA (One Big Beautiful Bill Act) in the U.S. during the summer, several of these stocks had room to rise significantly on positive news and outlooks. Investments within the broader climate and environmental segments rose a modest 4.5 percent in 2025. 

The Technology theme had another strong year, rising 23.2 percent. This marks the third consecutive year with returns above 20 percent. From 2023 through January 2024, the weight of technology within Global Equity was increased from 8 percent to 20 percent in consultation with group management. The theme has therefore been a significant contributor to overall returns in the Global Equity mandate in recent years. 

As in prior years, semiconductor companies were the main driver of performance in 2025, rising well above 40 percent. Approximately 30 percent of investments are in companies outside the technology sector. Although these investments rose around 20 percent, they underperformed the technology sector companies. Unlike previous years, Asia was the strongest region in 2025 and contributed positively to the theme’s returns. These investments accounted for 16 percent of capital and rose 40 percent in 2025. 

US Centric rose a moderate 6.8 percent in 2025, below expectations. This can be attributed to an investment with a manager focused on defensive quality companies. The quality factor significantly underperformed the broader market in 2025. The largest negative impact, however, came from stock selection within the healthcare, technology and communication sectors. 

Investments in U.S. growth companies had a good year, though somewhat below the broader. U.S. market. Technology investments delivered the highest returns, while discretionary consumer investments were the weakest among the larger sectors. 

Europe was established as a dedicated theme in the Global Equity mandate in 2025. Since inception at mid-year, the theme delivered an 8 percent return in USD. The investments within the financial sector, particularly banks, delivered the strongest performance during the period, rising 25 percent, followed by healthcare investments, which rose 12 percent. 

Global Fund Opportunities consists of fund investments offering attractive absolute returns with lower correlation to equity markets than traditional equity funds. The mandate delivered returned 12.4 percent in USD. Liquid investments rose 13.7 percent in USD, with particularly strong contribution from one of the three funds. Illiquid investments rose 11.1 percent, with U.S. investments contributing positively and European and Asian investments detracting. 

Allocations

Total net cash flow from External Management was NOK 34 million, consisting of distributions from funds within Global Fund Opportunities. 

At the end of 2025, assets under management totaled NOK 8.6 billion, allocated across 15 different managers. Of this, Global Equity accounted for NOK 5.0 billion and Global Fund Opportunities for NOK 3.6 billion.