Record earnings of Norwegian fund

Norway's $2,3 trillion sovereign wealth fund, the world's largest, posted a record profit of 1,75 trillion Norwegian kroner ($184,3 billion) in the first half of the year, driven by a surge in technology stocks, it said on Wednesday.

The fund invests the Norwegian state's revenues from oil and gas production, and on average owns about 1,5 percent of shares in companies listed on stock exchanges around the world, making it the largest individual investor in the world.

"The result is a consequence of good returns in the equity market, especially in Asian technology companies," said the fund's executive director Nikolai Tangen in a statement accompanying the first-half results.

The fund's return in the first six months exceeded the previous record of 1,5 trillion kronor, achieved in the first half of 2023. This amount, according to a Reuters comparison, is approximately equal to the nominal gross domestic product generated for the entire year by a country like Uzbekistan, with a population of about 39 million.

The fund's management, however, has repeatedly warned that future wars and economic depression could wipe out much of the value of its investments.

Tangen said yesterday that the ten largest companies in the portfolio now account for 20 percent of the fund's total value, and most of them belong to the technology sector, which increases the concentration risk associated with an investment strategy based on stock market indices.

"Chips, chips, chips, chips, chips... We've never seen this concentration before," Tangen said.

Any change to that strategy would have to be approved by the Norwegian parliament, a process that usually takes years.

The fund announced for the first time late Tuesday that it had a 0,05 percent stake in Elon Musk's SpaceX company, worth $1,22 billion, as of June 30, according to an updated list of its investments.

That stake, however, is modest compared to the fund's other technology investments.

According to the fund, he owned 1,28 percent of Nvidia shares, worth $62 billion, 1,24 percent of Apple, worth $52 billion, 1,17 percent of Alphabet, worth $50 billion, 1,27 percent of Microsoft, worth $35 billion, and 1,7 percent of Taiwan Semiconductor Manufacturing (TSMC), worth $34 billion.