Norway’s $2.3 Trillion Sovereign Wealth Fund Posts $29.7 Billion Third-Quarter Loss on Bond Weakness

Third-quarter loss of 278 billion kroner as global bond prices slump

Portfolio allocation: 72.1% equities, 25.8% bonds

Equity holdings are concentrated in U.S. tech stocks including Nvidia and Apple

Norway’s sovereign wealth fund, the world’s largest, said on Oct. 22 that it posted a third-quarter loss of 278 billion kroner, or about $29.7 billion.

Trond Grande, deputy chief executive of Norges Bank Investment Management, or NBIM, which manages the fund, said in a statement that rising bond yields hurt returns in fixed-income investments. He added that a sharp drop in global bond prices in the third quarter had a major impact as inflation and concerns over heavy government debt loads weighed on markets.

The fund had 22.04 trillion kroner, or about $2.3 trillion, in assets under management as of Sept. 30. Its portfolio was made up of 72.1% equities and 25.8% bonds. Equities returned 0.5% in the quarter, while bonds lost 3.5%.

In fixed income, the fund holds 1,664 bonds across 51 countries. About 70% of those holdings are government bonds. Last month, it said it planned to reduce its holdings of U.S. Treasuries.

The fund’s major investments are in U.S. technology stocks, including Nvidia, Apple, Alphabet and Microsoft.

Lee Mi-a, Hankyung.com reporter mia@hankyung.com