Daniel Wolfram
The return on investment for AI and technology has made Norway immensely wealthier over the last year
There is a constant debate over the artificial intelligence boom.
Is it going to continue or will it burst at any time?
For now, Norway is reaping the benefits of owning stocks in technology and AI.
Riding the tech wave
Bloomberg reports that Norway’s sovereign wealth fund just delivered its strongest quarterly return in six years, growing by $2.3 trillion. The world’s largest wealth fund surged by 11.5% in the second quarter.
Stock markets drove most of the growth.
Artificial intelligence also played a central role in this massive surge. Computer chipmaker Nvidia remains the fund’s top holding, closely followed by Microsoft and Apple.
“Chips drive fund’s value on a scale not seen before,” Chief Executive Officer of Norges Bank Investment Management (NBIM) Nicolai Tangen told reporters at a news conference.
From oil to AI
Created in the 1990s, the fund grew out of Norway’s massive North Sea oil and gas that were discovered back in the 1960s. Today, the fund owns around 1.5% of all listed stocks globally.
Meanwhile, this surge is the result of investments in telecommunications, technology, and AI-related stocks.
Owning such a large volume of stocks and technology bonds creates a clear risk. With American investments making up 55% of the portfolio, advisors recently urged Norwegian investment managers to prepare for growing geopolitical risks.
To take on these challenges, the team is turning to technology itself. NBIM now deploys large language models to screen newly added companies for corruption and human rights issues.
Tough moral choices
Big investment returns are not the only big story in Oslo. A fierce public debate has erupted over where that money actually goes.
Specifically, critics are questioning investments tied to Israel’s military actions in Gaza. Bloomberg reported that the fund remains invested in 29 Israeli companies, though governance officers state all of them comply with existing rules.
A full political review of those ethical guidelines is currently underway. Requested by Finance Minister Jens Stoltenberg, the formal panel report is expected by October 15.
