- financial enterprises. accordingly, investment and trading strategies have also become more diverse. in particular, let me focus on the changing nature of index investment. it is true that a significant proportion of investment is still tied to strategies which replicate major indices by investing in the front end of the curve and passively rolling into the next contract each month. however, some managers are adopting so - called “ enhanced ” index strategies, which may entail positions on various parts of the curve or allow investments in subsets of commodities. 2 etf sponsors have also diversified their investment strategies. etf sponsors, especially in the case of etfs linked to the price of precious metals, typically take long positions in commodity spot markets under so - called physical etf schemes. however, we have seen the emergence of synthetic etfs, that is, etfs backed by derivatives. under synthetic etf schemes, etf sponsors often engage in total return swaps or commodity futures to issue etfs linked to major indices. they also use other types of derivatives to issue complex products such as short etfs and leveraged etfs, although their presence is still limited at this stage. turning to other participants, hedge funds typically take both long and short positions for arbitrage purposes or based on macro - economic views. ctas trade in futures markets and often employ technically - based trading strategies such as trend following strategies. more recently, some ctas have become increasingly involved in algorithmic and high - frequency trading ( hft ). this is often described as a response to changes in the shape of futures curves and / or a crowding out of investor activities in some part of the curves. bis central bankers ’ speeches the growing participation of financial investors in commodity futures markets may also affect spot markets. in particular, several leading commercial and investment banks have become increasingly active in some physical markets, providing liquidity to their clients through arbitrage between physical and financial markets. there seems to be a variety of motives behind the growing investment in commodities. some investors view commodities as an effective tool in hedging against inflation. institutional investors with a long - term investment horizon have been attracted by the diversification benefits for portfolio rebalancing and high convenience yields. furthermore, some investors consider commodity investments as a proxy for investment in rapidly growing emerging market economies. investable assets in these economies are still limited. thus, in order to gain exposure to these rapidly growing emerging market economies, some investors turn to commodity investments correlated strongly with growth

lim hng kiang : opening of the norges bank investment management ’ s singapore office remarks by mr lim hng kiang, minister for trade and industry and deputy chairman of the monetary authority of singapore, in celebration of the opening of the norges bank investment management ’ s singapore office, singapore, 1 july 2010. * * * minister sigbjørn johnsen, governor svein gjedrem, ambassador janne julsrud, ladies and gentlemen, good evening. 1. it is a pleasure to be here to celebrate the opening of norges bank investment management ’ s ( “ nbim ” ) singapore office. 2. the opening of nbim ’ s investment office here is an affirmation of the growing importance of asian markets in the portfolios of many long - term investors like nbim. it also reflects singapore ’ s role as a key location to manage asian investments. your presence here will not only bring you closer to the markets you invest in but also help form stronger ties with partners in this part of the world. 3. among the sovereign wealth funds or swfs around the world, nbim is widely regarded as a role model for transparency and governance. being one of the earliest swfs, nbim has built up a strong reputation of excellence and leadership in investment and risk management, governance and talent management practices. nbim has stayed focused on its objective to preserve and grow wealth for the future generations of norwegians by diversifying its investments internationally and developing a talented investment team. your track record has been most enviable. 4. here in singapore, as we develop gic to invest our national reserves, we have always looked towards nbim in maintaining a close professional exchange of views and in mutual learning from one another. over the past 12 years, the two organisations have actively exchanged best practices across a full spectrum of investment, risk management, operational and governance issues ; the professional ties extend across many levels between the two organisations. these, i am told, have included a regular dialogue between gic ’ s senior management and governor gjedrem of norges bank and his management team at nbim. 5. this partnership extends into the international arena. in particular, the work undertaken by the international working group or iwg, imf ’ s grouping of swfs which includes both norway and singapore, has important relevance to the global community. i believe nbim and singapore ’ s gic