Mutual funds, quarterly figures

Definitions of the main concepts and variables:

Mutual fund: Mutual funds are collective investment undertakings through which an indefinite circle of investors pool funds for investment mostly in securities such as listed shares, equity certificates, bonds and short-term debt securities.

Securities: A security is a negotiable financial instrument. Negotiability refers to the fact that its legal ownership is readily capable of being transferred from one owner to another by delivery or endorsement. While any financial instrument can potentially be traded, a security is designed to be traded on an organised exchange or “over the counter”, although evidence of actual trading is not required. The over-the-counter marketinvolves parties negotiating directly with one another, rather than on a public exchange.

Securities include debt securities and equity securities, securities such as listed and unlisted shares, equity certificates, bonds and short-term debt securities.

Type of mutual funds:

The mutual funds are grouped into the following six types of mutual funds, according to how the mutual funds share capital is invested: equity funds, bond funds, money market funds, hybrid funds, other bond funds and other funds.

Equity fund is a type of mutual fund, where 80 percent of shareholders’ capital is invested in equity securities, mainly listed shares and equity certificates.

Bond fund is a mutual fund invested in debt instruments or bond funds. It is also called debt fund. Share capital in bond funds are invested in long-term debt instruments.

Money market fund is a mutual fund or more exactly a debt fund that invests in short-term debt securities such as treasury bills and commercial papers that are called money market instruments that have maturity of less than a year.

Hybrid fund is a mutual fund that invests both in equities and bonds. The percentage of equities or debt instruments in the portfolio of the hybrid funds varies from one hybrid fund to another. This percentage may also vary over time.

Other bond fund is a debt fund that doesn’t fall into the category of bond fund or money market fund.

Other fund can be described as a mutual fund that cannot be classified as any of the above mentioned funds. Hedge funds among others are classified under this category.

Evaluating

The market value of the mutual funds' shares is based on the net share value of the individual fund at the end of each period.

The market value of the securities owned by the mutual funds is based on available market rates. For listed securities, this will mainly be the market price from the Oslo Stock Exchange and foreign stock exchanges. For the non-listed, VPS-registered securities, estimated market rates derived from annual tax assessment rates are used.

The sector and industry classification for Norwegian enterprises (issuers/owners) is entirely based on the Register of Business Enterprises in Brønnøysund that is based on the international requirements stated in SNA2008/ESA2010 and NACE Rev.2 from the 4th quarter of 2006.

National level, no regional divisions.

Quarterly. Normally published 9-10 weeks after the end of the reference period.

OECD and BIS

Time series are stored in a database solution.

The purpose is to provide an overview of the mutual funds’ balance sheet, with a particular focus on the sector information of the funds’ shares capital and mutual funds’ assets. Data basis is also used as an input for the balance of payments, financial sector accounts and the money supply statistics.

The statistics were established in 1997 and contains quarterly data as of 1st quarter of 1996. Data is also available for earlier periods, on an annual basis, annual accounting statistics for mutual funds.

The responsibility for publishing the statistics was transferred from Central Bank of Norway to Statistics Norway as of 1 January 2007.

In addition to Statistics Norway, important users are, public authorities, research institutes and participants in the securities markets.

Not relevant

Adapted in accordance with the national accounts’ recommendations.

The Statistics Act § 2-2.

Not relevant

The statistics are based on:

• Data on mutual funds’ shares capital and on the transactions of mutual funds shares.

• Data on the mutual funds’ holdings of Norwegian and foreign securities.

The statistics is based on quarterly reporting of the mutual funds’ managers, monthly data deliveries from the Norwegian Central Securities Depository (VPS) and custodians (for information on the mutual funds). ORBOF (accounting information for banks and financial undertakings) is used as a source, with regard to the mutual funds’ bank deposits.

The statistics include all Norwegian-registered mutual funds.

Primary data on mutual funds’ shares are received electronically from the mutual funds’ managers, via AltInn, the common Web portal for public reporting. Other relevant data, mainly on the mutual funds’ holdings of securities, is extracted from data that the Division for Financial Market Statistics collects from other sources for securities data.

Primary data is controlled for each source. In addition, controls are carried out on balance sheet level, both per mutual fund and at an aggregate level. Data series are reviewed on an ongoing basis and are published together with the data for the new reference period.

For some smaller balance sheet items where no quarterly data are received, interpolations are made, based on the annual accounts data.

Not relevant

Statistics Norway’s standard confidentiality rules apply.

Generally, the mutual funds statistics provide quarterly data comparable over time. However, changes in the legal framework, changes in the regulation of registration requirements in the Securities Register act and changes in the institutional sector classification can all lead to break in the time-series data. The main changes that are introduced are as follows:

2012: A new four digit institutional sector classification is introduced

The new sector classification was adopted in the mutual funds statistics as of January 2012. One of the most significant changes is that the line between financial and non-financial sectors has been shifted such that the value of the financial sectors increased. In addition to this, new financial sectors were introduced such as investment trusts and private equity funds other financial enterprises, except insurance companies and pension funds. Households and non-profit institutions serving households are also treated separately according to the new institutional sector classification.

2012: New classification of type of funds

Statistics Norway introduced changes in the classification of the mutual funds as of 1st January 2012. This change in the standards is in line with the Norwegian Fund and Asset Management Association’s (VFF) standards, which they introduced in 2010. According to this, a new group called ‘other bond funds’ was introduced and the money market funds were defined more precisely. Changes were in line with the new guidelines that were drawn by ESMA- European Securities and Markets Authority to have a new common definition of the money market funds.

2006: Changes in the statistics as of 4th quarter of 2006

The mutual funds’ investments in mutual funds shares are included in the figures as of 4th quarter 2006. Previous quarters were published as net figures, i.e. without these investments.

In addition, the information regarding what mutual funds own in terms of shares, bonds short-term debt securities were directly collected through VPS (Norwegian Central Securities Depository) and the custodians that deposit the mutual funds’ assets.

2004:

A quarterly direct reporting of information on the mutual funds shares, via mutual funds’ managers has been established starting with the 4th quarter of 2004.

To the extent that the fixed delivery from the primary sources contains errors or defects, this could affect the statistics. Processing and control routines have been established in order to detect and correct such errors and defects.

Not relevant