15.11.2011
 
Changes in the public's financial assets portfolio in the third quarter of 2011
 
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  In the third quarter of 2011 the value of the public's financial assets portfolio fell by about 2 percent in real terms, to around NIS 2.45 trillion at the end of September.
  The decline in the third quarter resulted from the fall in prices of shares traded in Israel. Since the beginning of the year, the value of the portfolio of shares in Israel has declined by NIS 153 billion.
  The value of the public’s shares portfolio abroad increased by about NIS 1.4 billion, primarily due to continued net investment in foreign stocks and bonds, and the effect of depreciation of the shekel against the dollar. These factors were partially offset by the drop in share prices on international markets.
  As a result of these developments, since the beginning of the year there has been a 4.5 percentage point drop in the weight of tradable assets in the portfolio, to 49.5 percent. This decline stems primarily from a drop in the value of short term securities in Israel.
In the third quarter of 2011 the value of the public's financial assets portfolio fell by about 2 percent in real terms, and at the end of September reached NIS 2.45 trillion. This followed the 3 percent real decline in the second quarter.
The decline in the value of the portfolio in the third quarter of 2011 was due mainly to the fall of about NIS 80 billion in the shares component in Israel, essentially the result of a decrease in prices on the Tel Aviv Stock Exchange (TASE), in addition to a NIS 9.2 billion (6.5 percent) effect of a price drop in stock markets abroad.
 



 
Shares in Israel
In the third quarter of 2011 the balance of shares held by the public dropped by some NIS 80 billion (17 percent), to NIS 384 billion, continuing the trend since the beginning of the year. The decline was due to the fall in share prices on the TASE––since the beginning of the year the value of the portfolio has fallen by about NIS 153 billion (28.5 percent).
Corporate bonds
In the third quarter of 2011 the value of negotiable corporate bonds in the portfolio was virtually unchanged, and at the end of September was NIS 241 billion—a 3.4 percent decline in bond prices (NIS 8 billion) that was partly offset by net new issues of a similar amount. For the year to date, the value of the bond portfolio has increased NIS 3 billion, as a result of net new issues of NIS 13 billion, (NIS 8 billion in the third quarter), which were partially offset by price declines of NIS 10 billion (4 percent).
The assets portfolio abroad
In the third quarter of 2011 the value of the public's assets portfolio abroad increased by about NIS 1.4 billion, to NIS 283 billion. The shares component dropped by about NIS 5.2 billion, to NIS 135 billion, mainly due to the decline in share prices in stock markets abroad, and despite the continued flow of net investment in foreign shares—primarily among institutional investors. The value of foreign bond holdings increased (by NIS 3.2 billion), as did the value of deposits abroad. The depreciation of the shekel against the dollar in the third quarter also played a part in the increase of the shekel value of the portfolio. Since the beginning of the year, the value of the portfolio of the public's assets abroad has increased by NIS 4 billion. The value of the public's foreign bonds increased by NIS 8 billion. This was partly offset by a decline in the shares and deposits segments of about NIS 2 billion each
 


 
In the third quarter of 2011 the share of risk assets in the portfolio declined by 2 percentage points, to 44 percent. The decrease in the share of tradable assets continued in the third quarter as well, and by the end of September the share reached 50 percent of the portfolio. Since the beginning of the year, the share of tradable assets fell by 4.6 percentage points.
* Further information and tables on the public's assets portfolio can be seen on the Bank of Israel's website