NPS Scores Big with U.S. Stock Bets, Earning 18 Trillion Won in Just Three Months

Focused Investments in Nvidia and Apple
U.S. Stock Portfolio Value Up 11.2%
New Additions Include Defense and Airline Stocks

In the third quarter of this year, the National Pension Service (NPS) adopted an aggressive investment strategy focused on large-cap technology stocks during the strong rally in the U.S. stock market, resulting in significant valuation gains. Thanks to the sharp rise in share prices of major big tech companies such as Nvidia, Apple, and Alphabet, the valuation of the NPS’s U.S. stock portfolio increased by approximately 18.7 trillion won over just three months.

According to the U.S. Securities and Exchange Commission (SEC) on November 6, the NPS held investments in 552 listed U.S. companies as of the end of September. This represents an increase of 3.4% (18 companies) compared to the end of June, when it held 534 companies. The number of shares held also grew by about 6.4%, from 808.05 million shares to 859.53 million shares.

During the same period, the par value of U.S. stocks held by the NPS rose by 11.2% (12.94 billion dollars, or about 18.7 trillion won), from 115.83 billion dollars (about 167 trillion won) to 128.77 billion dollars (about 186 trillion won).

The main driver behind this increase in valuation was Nvidia, the leading artificial intelligence (AI) stock, along with other large-cap technology companies. The valuation of the NPS’s Nvidia holdings surged by 2.583 billion dollars (25.8%), from 7.3521 billion dollars at the end of June to 9.24574 billion dollars at the end of September. Over this period, the NPS increased its number of Nvidia shares by 6.5%, from 46.54 million to 49.55 million shares.

Apple was next, with the valuation of its shares rising by 1.65761 billion dollars (28.0%), from 5.91177 billion dollars to 7.56937 billion dollars, while the number of shares held also increased by about 3.2%.

Despite only modest increases in the number of shares held for Alphabet, Google’s parent company (3.1%), and Tesla (3.0%), the sharp rise in their share prices led to significant valuation gains of 42.3% and 44.2%, respectively.

Additionally, the NPS increased its holdings in Broadcom, Microsoft, Intel, Lam Research, and others by between 1.5% and 4.6%, with valuations rising by at least 8.9% and up to 52.1%.

In some stocks, valuations declined due to falling share prices, but the NPS instead saw this as an opportunity to buy at lower prices. For example, the number of Netflix shares held by the NPS increased by 3.1% during the third quarter, but the valuation fell by 7.7%, from 1.20452 billion dollars to 1.11184 billion dollars, due to the drop in share price.

The NPS also increased its holdings by 1.3% to 2.7% in other stocks that performed poorly in the third quarter, such as Salesforce, Costco, Chipotle Mexican Grill, Walt Disney, Coca-Cola, Starbucks, and the cryptocurrency exchange Coinbase. However, in some stocks such as American Express (-99.9%) and Domino’s Pizza (-42.5%), valuations dropped sharply.

Stocks newly added to the portfolio or in which the NPS significantly increased its investment in the third quarter are also drawing attention. Major U.S. airlines such as Delta Air Lines and United Airlines Holdings, electric vehicle manufacturer Rivian, and casino operator Las Vegas Sands Group were reintroduced to the NPS holdings list. The NPS also newly acquired shares in conservative-leaning media companies, including News Corp, the parent company of The Wall Street Journal, and Fox Corp, the parent company of Fox News. In addition, the NPS increased its holdings in U.S. defense contractors such as Lockheed Martin, RTX, and L3Harris.