The largest sovereign wealth fund in the world lost 40 billion in the first quarter

The Norwegian Sovereign Wealth Fund, which is $ 1.7 billion, recorded its largest quarterly loss, influenced by the fluctuations of the world markets and the decline in the value of the shares of technology companies. “Noxes Bank Investment Management”, the investment arm of the Norwegian Central Bank, announced in a statement on Thursday that the fund has lost 0.6%, equivalent to $ 40 billion, in the first three months of this year, which is the largest loss since the third quarter of 2023. Despite its nature as a follower of the Indikators, -Investments dropped. Despite the decline, the fund’s performance exceeded the reference index during the quarter by 0.16 percentage points. “This term there were serious fluctuations in the markets … and our investments in equities achieved a negative return as a result of the performance of the technological sector mainly.” Losses due to the Last Loss War did not fully reflect the consequences of commercial escalation in the United States, after US President Donald Trump imposed high customs at the beginning of April. The fund has major interests in giant technology companies such as “Apple”, “Microsoft”, “Invidia”, “Alphabet”, “Amazon” and “Mita”, along with “Tesla”. These prejudices were previously a strong profit for the fund and achieved an annual return of 13% in 2024. According to the CEO Trond Grande, the fund took a position under the reference weight against these shares 18 months ago. Tangin said at a press conference that the plan is currently aimed at correcting this trend and return to a natural weight in the US market. The Norwegian sovereign wealth fund mainly depends on market indicators, leaving a limited space for active investment. The Norwegian Ministry of Finance determines the fund’s reference index, based on the ‘Fuzi Global First Cap’ indicators for shares, and ‘Bloomberg Barclays’ for fixed income instruments. During the first quarter of the year, the government pumped 78 billion crowns (equivalent to $ 7.5 billion) in the fund. The fund is subject to a set of strict moral guidelines, whereby companies that violate the rights of human rights or workers are excluded, or contribute to serious damage to the environment. It is also prohibited to invest in companies that produce certain weapons, such as nuclear weapons and group bombs. But the opposition conservative party in Norway insists on changing these guidelines and criticizing the ban on investment in companies such as “Lockheed Martin”, although the state buying products from them. The party believes that the prevention of the fund to invest in ‘illogical’ nuclear weapons manufacturing companies. The fund currently has shares in more than 8,600 businesses around the world, but Norwegian Finance Minister Yenos Stoltenberg recently announced a plan to reduce this number, by liquidating investments in a large number of small businesses in emerging markets. Given the large subject size, the implementation of these plans will take time.