The public's financial assets portfolio in the fourth quarter of 2012
§ In 2012 the value of the public's financial assets portfolio increased by about 5.8 percent in real terms (by NIS 190 billion), and reached NIS 2.7 trillion at the end of December.
§ Most of the growth was registered in the value of the government bonds portfolio, which increased by NIS 52 billion (17.2 percent). There was also an increase of about NIS 18 billion (about 8 percent) in the domestic tradable bonds portfolio. The domestic shares portfolio increased by about NIS 16 billion (4.2 percent), due primarily to the increase in share prices on the Tel Aviv Stock Exchange (TASE).
§ The value of the public’s assets portfolio abroad increased by about NIS 29 billion (14 percent), primarily in the foreign shares component: the combination of increased investment flow from Israeli residents and an increase in share prices on foreign stock markets.
§ As a result of the above developments, the share of tradable assets in the portfolio increased by one percentage point in the fourth quarter while the share of deposits in Israel and abroad declined.
§ There was a net increase of around NIS 28 billion (20 percent) in the section of the portfolio managed through mutual funds in 2012, primarily through net new investments in government bond funds and corporate bond funds.
1. The total assets portfolio
In the fourth quarter of 2012 the value of the public's financial assets portfolio increased by about 2.9 percent in real terms, and reached NIS 2.7 trillion at the end of December.
The increase was due primarily to an increase of about NIS 27 billion (7.2 percent) in the value of the Israel shares portfolio and about NIS 21 billion (6.2 percent) in the value of the tradable government bonds portfolio.
In 2012, the value of the public's financial asset portfolio increased by about 5.8 percent (NIS 190 billion) in real terms. The main increase was in the value of the government bonds portfolio, which grew by NIS 52 billion (17.2 percent) in 2012. There was a parallel increase of about NIS 18 billion (about 8 percent) in the domestic tradable bonds portfolio The value of the shares portfolio in Israel and abroad grew by about NIS 45 billion in 2012. The increases in the shares component reflected the price increases in stock markets in Israel and globally, but also reflected the strengthening flow of net investments into foreign shares.
During 2012, there was an increase of about 1 percentage point in the share of tradable assets in the portfolio, and of about 0.6 percentage point in the share of risk assets. At the same time, there was a decline in the share of deposits in Israel and abroad, and of Makam.
2. The securities portfolio, by main components
Shares in Israel
In the fourth quarter of 2012 the balance of shares held by the public increased by some NIS 27 billion, to NIS 408 billion. Among the reasons for this increase were purchases by Israeli residents of shares in a large Israeli company owned by nonresidents, as well as the effect of price changes of Tel Aviv Stock Exchange-traded shares and of Israeli shares traded abroad (dual-listed shares).
For the full year of 2012 the value of the shares portfolio in Israel grew by about NIS 16 billion (4.2 percent). The portfolio's value was mainly affected by changes in share prices on the Tel Aviv Stock Exchange, which fell sharply during the second quarter of the year, and then rose strongly in the third quarter
In the fourth quarter of 2012 the value of negotiable corporate bonds in the portfolio increased by about NIS 7 billion, and by NIS 19 billion over the course of the year and reached NIS 257 billion at the end of December. The increase was the combined result of net bond issues, which totaled about NIS 9 billion (4 percent), and price rises in the corporate bond market (about 4 percent).
The assets portfolio abroad
In the fourth quarter of 2012, the value of the public's assets portfolio abroad declined, mainly as a result of a decline in stock market prices during this period. During 2012, there was a significant increase of about NIS 29 billion (14.8 percent) in the value of the portfolio abroad held by Israeli residents, to NIS 321 billion. The growth in the portfolio abroad is due to an increase in the flow of investments by Israeli residents into foreign shares (NIS 18 billion, 12 percent), primarily by institutional investors, and an increase in share prices on stock markets abroad (about 8 percent on average). These were partially offset by the appreciation of the shekel against the dollar (2.3 percent), which reduced the shekel value of the portfolio.
3. Mutual funds
The value of the portfolio managed by Israeli mutual funds was NIS 170 billion at the end of the year, about 6 percent of the public's total asset portfolio. In the fourth quarter of 2012, mutual fund assets increased by about NIS 10 billion (6 percent)—the combination of a NIS 6.6 billion surplus of new investments over redemptions, and price increases in the markets.
Overall, 2012 was characterized by a marked increase of about 20 percent in the value of mutual funds (NIS 27 billion), with most of the increase—about NIS 20 billion—coming from net investments (investments minus redemptions and dividend payments), in contrast to net redemptions of NIS 11 billion in 2011.
A breakdown of mutual funds by specialization shows that net investments were concentrated in government bonds (NIS 13 billion) and corporate bonds (NIS 8 billion), mainly in the fourth quarter of the year. Money market funds showed net investments until the third quarter of the year, while they showed net redemptions in the fourth quarter.