The world's largest sovereign wealth fund reports significant losses

Norway's sovereign wealth fund, which is the largest sovereign wealth fund in the world with $1.4 trillion in capital, has reported significant losses arising from investments in the third quarter. The total amount of losses is more than $30 billion.

The fund's statements showed a return on investment of minus 2.1% during the period from July to September. Much of these losses were caused by a drop in the value of stocks and bonds.

Equities are the largest asset class of the fund, representing 70.6% of its value, and they lost 2.1% in value this quarter. Fixed income investments, which account for just over a quarter of the fund's assets, posted a 2.2% loss, while real estate assets saw a 3.3% decline in value.

Trond Grande, the fund's deputy CEO, indicated that such a widespread decline may be due to certain fundamental macroeconomic factors that have affected the market. He noted that one possible factor is the rapid rise in interest rates.

Despite these losses, Grande noted that over the past year, equities have still performed better than other types of assets. However, he also expressed concern that this growth is based on a limited number of American technology companies.

As for the events in the Middle East, in terms of the war between Israel and Hamas, the fund takes very little risk. Only 0.1% of its investments are in Israel. The fund has not changed its investment strategy in this country, but is studying the situation on the ground.

In general, the fund's losses are the result of global market fluctuations and structural changes in the global economy, and they may affect the Norwegian fund's attempts to provide a stable income for future generations.