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The Norwegian 10Y treasury bond has a coupon rate of 1.3% (lower than the US T-Note! suffice to say, very cheap). The wealth fund has been growing around 8% pe
by bkanber 10y ago
The Norwegian 10Y treasury bond has a coupon rate of 1.3% (lower than the US T-Note! suffice to say, very cheap).
The wealth fund has been growing around 8% per year.
Borrow money at a rate of 1.3%, reinvest it and make 8%.
It's one of the golden rules of banking: if you can borrow money for cheap, do so.
- Dolores12 10y agoThe fund generated an annual return of 5.5 percent between 1 January 1998 and the end of the second quarter of 2016. After management costs and inflation, the annual return was 3.6 percent. https://www.nbim.no/en/the-fund/return-on-the-fund/ https://www.nbim.no/en/the-fund/return-on-the-fund/
- kagamine 10y agoBut does that not include a sharp dive during 2 recessions in Europe?