Permanent fund's top 50 stocks includes giants

Valley Life editor

If you've bought a computer with Windows on it, your neighbor should probably thank you tomorrow. And the next time your wife yells at you for drinking a Budweiser while watching ESPN, make sure you remind her that you are just helping your dividend grow.

That's because those -- Microsoft, Anheuser-Bush and Disney (which owns ESPN) -- are three of the permanent fund's largest holdings, and their success is related to the success of the permanent fund's success.

The permanent fund dividend check is calculated on earnings from the fund's investments -- and as of June 30, the fund's biggest investment in the stock market was in the General Electric Company. The permanent fund owns 8.117 million shares, which represents a market value of over $264 million. The fund actually owns more shares of Microsoft -- 8.229 million shares -- but at a market value of $235 million.

Following those two stocks in the top 10 holdings are Pfizer, Citigroup, Wal-Mark, American International Group, Exxon Mobil, Johnson and Johnson, Wells Fargo and Procter and Gamble.

The fund's top 50 holdings is filled with companies many people would recognize -- Coca Cola, Intel, Pepsico, Dell, 3M, Yahoo and other large corporations that have proven track records.

The fund, created by a constitutional amendment in 1976, started with a balance every investment account starts with -- zilch. Since then, it has grown to more than $27.4 billion. The fund is among the 100 largest investment funds in the world, and in the U.S., it is larger than any single endowment fund, private foundation or union pension trust.

According to the Alaska Permanent Fund Corporation's Web site, the goal is to "earn slightly better than average rates of return with slightly below-average levels of risk."

Of course, having a well-balanced portfolio means having money invested in not only domestic stocks, but also a wide range of other funds, including international stocks, real estate and bonds. But the stocks are where the fund has made the most money, historically. Since 1983, when the fund began investing in the U.S. stock market, it has earned a 13 percent average annual rate of return, according to the APFC Web site. Since the fund began investing in international stocks, in 1992, the fund has enjoyed a 7.3-percent rate of return.

In 2004, the fund enjoyed an even better rate of return, across all investments. As a whole, the fund ended the fiscal year on June 30 with a 14.1 percent return.