Saudi Arabia's sovereign wealth fund cut its exposure to North American equities by $3 billion in the third quarter, offloading some exchange traded funds (ETF) and stocks including Berkshire Hathaway BRKa.N, a regulatory filing showed.
The Public Investment Fund (PIF) was holding $7.05 billion worth of US equities as of Sept. 30, compared with nearly $10.12 billion in the second quarter, the filing showed late on Monday. The fund cut its holdings of ETFs to $1.96 billion by Sept. 30, from nearly $4.7 billion in the second quarter.
In recent months, the sovereign wealth fund had bulked up minority stakes in companies worldwide, including oil companies, taking advantage of market weakness caused by the COVID-19 pandemic.
In the previous quarter, it moved part of those investments into real estate, materials and utilities ETFs. In the third quarter, it was holding only the utilities ETF, Reuters reported.
“In terms of strategy, there has always been a sense that PIF is trying to play catch-up with regional peers, but wants to fast-track the kind of returns that investments by other sovereign funds generated over many years,” said Rachna Uppal, director of research at Azure Strategy, a Middle East-focused consultancy.
The latest filing showed that PIF sold some stocks, including Berkshire Hathaway, Canadian Natural Resources and Cisco Systems in the third quarter, and bought 13 million shares of Novagold Resources.
PIF, which manages $360 billion worth of funds, pursues a two-pronged strategy - building an international portfolio of investments and investing locally in projects that will help reduce Saudi Arabia’s reliance on oil.
