Norway wealth fund sounds alarm on AI stock market bubble
The head of Norway's sovereign wealth fund has warned that soaring AI-driven stock valuations could trigger a sharp correction. How exposed is the world's largest sovereign wealth fund to a market downturn?
Norway's Government Pension Fund Global, the world's largest sovereign wealth fund, has raised concerns about an impending AI stock market bubble. CEO Nicolai Tangen stated that a massive loss to its $2.4 trillion portfolio is not entirely improbable in an extreme market collapse. The fund, created to invest Norway's vast oil and gas revenues, delivered a record profit in the first half of the year.
However, Tangen warned that AI-chip valuations now pose a serious risk. A sharp correction could potentially erase much of the wealth built over the past 30 years. Despite this, many fund managers remain cautious about stock valuations but are reluctant to take profits. Norway's fund largely follows a passive, broadly diversified global index strategy, leaving little room for active hedging.
The fund's exposure to AI stocks through technology investments is roughly a third of its stock investments.
Written by urgent.news from DW News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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