The world's largest sovereign wealth fund posted a profit of $213 billion

This follows a record loss of 1.64 trillion kroner for the full year 2022, which the fund attributed to “highly unusual” market conditions at the time.

“Despite high inflation and geopolitical turmoil, the stock market was very strong in 2023, compared to a weak year in 2022,” Nicolai Tangen, chief executive of Norges Bank Investment Management, said in a statement.

“Technology stocks in particular have done very well,” he added.

Norway's sovereign wealth fund, World's largest, was established in the 1990s to invest surplus revenues from the country's oil and gas sector. To date, the fund has invested in more than 8,500 companies in 70 countries around the world.

Last year, Norges Bank Investment Management said Its return on equity investments was 21.3%, its return on fixed income investments was 6.1%, while unlisted real estate investments returned -12.4%.

The fund attributed negative annual interest rates and low demand to its unlisted real estate investments.

The fund returned 3.7% on investments in unlisted renewable energy infrastructure through 2023.

At the end of last year, Norges Bank Investment Management said the fund was almost 80% invested in equities, 27.1% in fixed income, 1.9% in unlisted real estate and 0.1% in unlisted renewable energy infrastructure.

Asked at a news conference about geopolitical issues that could affect stocks in 2024, Norges Bank Investment Management's Tangen replied, “These days you have geopolitical hotspots in a lot of places.”

“So, what do we need to watch out for? Well, tension between the US and China is negative for economic growth and global trade. It's an inflationary force as people move closer to home and production closer to home,” he continued.

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“We see the effect of geopolitical tensions in the Middle East through long trade routes. [and] High inventory costs. So, it is negative. And, of course, the most dire geopolitical situations are the ones you don't know that haven't happened yet.”

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