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Norwegian Wealth Fund Lost More than 150 billion Euros in 2022

norwegian wealth fund lost more than 150 billion euros in 2022

Norwegian wealth fund, one of the most affluent investors in the world, reported an unprecedented loss of 1.64 trillion crowns ($164.4 billion) for 2022 – its worst since a 633 billion crowns debacle back in 2008. This result draws to a close three consecutive years of exceptional profits as stocks and bonds were adversely affected by inflation and the Ukraine conflict. The fund earned over one trillion crowns every year from 2019-2021, cumulatively accumulating more than four trillion crowns throughout that period!

Norwegian Wealth Fund Suffered The Biggest Loss From Amazon Stocks

The Norwegian wealth fund‘s CEO, Nicolai Tangen, remarked at a press conference: “We have investments in 9,000 companies across 70 countries – there isn’t any escape!” The biggest loss that the fund faced was from its holding of Amazon to the tune of 56 billion crowns. This was followed by Meta shares dropping 52 billion and Tesla shedding 47 billion crowns.

Despite the overwhelming loss, the fund’s value rose by a dramatic 89 billion crowns or $8.9 billion year-on-year – thanks to cash inflows surpassing 1.1 trillion crowns and Norway’s weakened currency exchange rate! To put this in perspective, these 2022 inflow values were nearly three times what was seen back in 2008 – an impressive 386 billion crown record set at that time.

norwegian wealth fund suffered the biggest loss from amazon stocks

Inflation Is Also A Big Problem For The Norwegians Wealth Fund

The Norwegian wealth fund (officially Oil Fund) strategically invests the country’s income from oil production. Boasting as Europe’s largest gas supplier following a decrease in Russian supply, Norway took advantage of the high energy prices caused by the war in Ukraine. “We must be cognizant that this influx came with an unfortunate consequence for our European neighbors,” remarked Tangen.

On average, the fund holds a 1.3% ownership in all public-listed stocks and investments in bonds, unlisted real estate, and renewable energy initiatives. Moving forwards, Tangen noted that inflation will still be an issue to consider.

Tangen warned Reuters that inflation is an ever-present risk, particularly as China ramps up consumption and geopolitical tensions remain elevated. Data from the Norwegian wealth fund‘s 2022 report revealed a return on investment of -14.1%, outstripping its benchmark index by 0.88 percentage points.

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