And their main conclusion is startling: If Finnes had followed the usual savings advice that people get at the bank, he would have earned far more than from his daily stock trades. – Finnes would have earned 1.1 million more if he invested the money in ordinary mutual funds, says investment director Robert Næss at Nordea to news. At the same time, he wanted to avoid putting his wife Erna Solberg in a predicament. Facts and assumptions * E24’s shareholder overview shows Finne’s shareholding as of 31 December each year from 2014 to 2021. Based on this, a value of well over one million kroner is assumed at the end of 2014 * A net sale of shares for a total of NOK 600,000 is assumed from September 2013 to December 2014, which is reinvested. * This indicates that he had around 1.6 million shares at the start of his term as Prime Minister. * Since there is some uncertainty in the calculation, it is rounded down to NOK 1.5 million. * A normal recommendation from financial advisers may be to invest the money in funds with low costs, typically index funds. * The equity fund DnB global index and DnB Norge index have been randomly selected. The global fund would have given a 215% return in the period, while the Norwegian index fund would have given a 129% return. * If he had followed the usual recommendations to place ¾ globally and ¼ in Norway, he would have achieved a return of 194 percent. This corresponds to a total profit of NOK 2.9 million before tax. * Finnes has stated that he collectively achieved share gains of NOK 1.8 million in the period while Erna Solberg was prime minister. It is assumed that the amount is before tax. * In other words, Sindre Finnes could earn NOK 1.1 million more by following the usual recommended savings advice. Source: Robert Næss, investment director at Nordea During the eight years that Conservative Party leader Erna Solberg was prime minister, her husband traded shares over 3,600 times, earning a total of NOK 1.8 million. Økokrim is now considering an investigation, and the case will in any case have an aftermath in the Storting in the Control and Constitution Committee. Finnes’ lawyer has been given the opportunity to comment on this case, but news has not received a response to the inquiry. TROUBLE: Sindre Finnes bought and sold shares on a large scale while Erna Solberg was prime minister. Here, the two cast their vote together in this autumn’s election. Photo: John Inge Johansen / news 60 per cent more The investment director at Nordea has followed Sindre Finnes’ share case closely since the news broke in the middle of the election campaign rush. – If you are a private person and want to trade individual shares, you have some very tough competitors, says Næss. – There are people who work on this full-time and spend a lot of money on analysis. So it is tough for ordinary individuals to buy individual stocks and do better than the others in the market. EXPERT: Nordea’s investment director Robert Næss. Photo: Emma-Marie B. Whittaker / n652996 At the request of news, Næss has calculated how much more or less Finnes would earn if he listened to the usual savings advice from the financial advisers. It is to invest most of the money in a global equity fund with low costs, and a smaller part in Norwegian index funds. The answer is that he would have earned 60 percent more by saving in the usual way, than by his frequent share trading during the years his wife was prime minister. – If he had bought three quarters in global index funds and one quarter in Norwegian index funds, he would have actually earned NOK 2.9 million. That is just over one million kroner more than he has actually earned, says Næss. – Correct picture Professor Trond Døskeland at the Norwegian School of Economics has looked at the calculations and believes they give a correct picture of reality. – This is not surprising. We see in the research that there are a lot of people who lose out against these recommended solutions, he says. Because it is very difficult to manage to do better than the market over time, even the vast majority of professionals cannot do that, history shows. INVESTIGATION: Conservative Party leader Erna Solberg will be summoned to a hearing at the Storting about the share scandal. Photo: Javad Parsa / NTB – If he had gone into the bank with this amount of money, he would have actually been offered to go into these global index funds and possibly a little mix with Norwegian ones, he says to news. – Then this ticked and went and gave a higher return than he himself managed to achieve by being very active. Professor Trond Døskeland at the Norwegian School of Economics. – Isn’t it the case that the more you trade, the more you can expect to lose against the market? – Yes. There is a somewhat amusing study that finds that men shop more than women. Ergo, they do worse than women. Women are better than men in the stock market, because men have too much faith in their own skills, says Døskeland.
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Finnes would earn 1.1 million more in ordinary mutual funds – news Norway – Overview of news from different parts of the country
