Tech stocks push world’s largest sovereign wealth to record $213 billion profit

Norges Bank Investment Management, the national wealth fund of Norway, posted a record profit of 2.22 trillion kroner ($213 billion) in 2023, mostly by virtue of the excellent returns on its investments in technology shares.

One of the biggest investors in the world, the Government Pension Fund Global, stated that the outcome represented its best return in kroner ever. The fund’s return on investment for the previous year was 16.1%. This was less than the fund’s benchmark index return by 18 basis points.

Founded in the 1990s to manage the oil and gas industry’s excess earnings, Norges Bank Investment Management has invested in over 8,500 businesses across 70 nations.

The return on stock investments made by Norges Bank Investment Management last year was 21.3%, fixed income investments yielded a return of 6.1%, and unlisted real estate investments yielded a return of -12.4%. Rising interest rates and muted demand made it a bad year for unlisted real estate investments.

In 2023, the fund’s investments in unlisted renewable energy infrastructure yielded a 3.7% return. Nearly 71% of the fund was invested in stocks at the end of the previous year, followed by fixed income at 27.1%, unlisted real estate at 1.9%, and unlisted renewable energy infrastructure at 0.1%.

In response to a question concerning geopolitical concerns that might have an impact on stocks in 2024, Norges Bank Investment Management’s Nicolai Tangen stated that the tensions in the Middle East have had a detrimental effect on trading routes and freight costs, and that the tensions between the United States and China are detrimental to global trade and economic growth.