Which Technology Companies Hold Our Pension Funds?

As of October 31, 2024, the assets of Georgia’s Pension Fund amounted to 5.8 billion GEL, according to information released by the Pension Agency. This growth indicates the fund’s successful strategic management of investments and its ability to generate returns. From August 6, 2023, to October 2024, the total returns generated by the fund reached 1.34 billion GEL, highlighting the financial health and stability of the pension system.

In the second week of November 2024, global markets experienced a general correction, impacting leading companies in the technology sector. The share prices of Apple, Nvidia, and Microsoft saw slight declines during the week. However, these changes are not linked to fundamental problems and remain temporary from a long-term perspective.

For example, investors attribute the decline in Apple’s share price to temporary market fluctuations. Despite this, the company’s stable revenues and innovative product launches maintain investor confidence. In Nvidia’s case, investors shifted to securing profits, leading to a temporary price drop. However, Nvidia’s leading position in artificial intelligence technologies ensures its continued dominance in the market. Similarly, Microsoft, as a leader in strategic innovation and technological development, retains its value, making it a profitable asset in the long term.

October 2024 marked one year since the introduction of three investment portfolios: dynamic, balanced, and conservative. The dynamic portfolio focuses primarily on high-yield but riskier assets, offering significant potential for generating higher returns, albeit with greater risk. The balanced portfolio includes both risky and stable assets, enabling investors to achieve stable returns with moderate risk. The conservative portfolio, meanwhile, prioritizes stable, low-risk assets, ensuring lower but consistent returns. Over this period, the dynamic portfolio led in both nominal and real returns.

According to the Pension Agency’s report, the real returns of the dynamic portfolio reached 15.6%, surpassing the balanced portfolio at 14.5% and the conservative portfolio at 12.7%. These figures demonstrate that the dynamic portfolio better reflects long-term growth potential.

Technology giants such as Apple, Nvidia, and Microsoft hold a significant place in Georgia’s Pension Fund investment portfolio. The inclusion of these companies’ stocks in the portfolio reflects the growing trust in the technology sector and the fund’s strategy of diversifying investment risks.

The top five companies in the pension fund’s portfolio include Apple, Nvidia, Microsoft, Amazon, and Meta. Together, these companies provide the fund with exceptional stability and growth potential. Apple accounts for 3.2% of the portfolio, Nvidia 3%, and Microsoft 2.8%. Amazon and Meta comprise 1.6% and 1.1%, respectively. This focus on companies that lead innovation in the technology sector ensures long-term stability and consistent returns for the fund.

Owning shares in dynamic and high-growth companies means that the Pension Agency strategically targets global growth segments, emphasizing innovation and technological development. This approach increases the potential returns on pension savings for Georgian citizens, ensuring a more stable and profitable future.

The Pension Fund’s investments in technological giants, along with the dynamic portfolio’s leadership, reflect the management’s bold and long-term-oriented strategy. An investment policy that supports the growth of high-tech companies allows the country’s citizens to benefit from the rapid development of the global economy and technological innovation. Although recent price declines in the technology sector present challenges, these fluctuations are not indicative of fundamental problems and, from a long-term perspective, create new opportunities for investors.