The National Bank of Kazakhstan has revealed its strategy for investing the National Fund’s money in alternative instruments, emphasizing the gradual increase in money committed to that tranche of investments to $2.5 billion by 2025. This portfolio, launched in 2023, represents 3% of the total allocation of the savings portfolio and will be a key element of asset diversification.
National Bank officials note that this decision came as part of a drive to balance the National Fund’s assets and improve returns. This, in turn, contributes to additional diversification and mitigation of risks.
The National Fund Management Concept to 2030, developed by the country’s main bank and approved by president Kassym-Jomart Tokayev, defines strategic principles and approaches aimed at maximizing returns. It includes the use of defensive strategies, factor investing, and also pays attention to ESG (Environmental, Social & Governance) principles.
The structure of the National Fund consists of a stabilization portfolio and a savings portfolio. While the former is invested in short-term government securities issued in developed economies, the latter is more diversified and includes a wide range of assets, including alternative instruments and a gold portfolio.
The National Fund’s assets currently stand at $60.7 billion, despite the withdrawal of 35.5 trillion tenge (~$77 million) over the past ten years, mostly during the pandemic.
