Whale Turnaround: The "Nordic Pension Legion" of the US Stock Market "Dunkirk"

Nordic countries, seemingly tucked away in a corner of the world, hide some of the world's top pension funds.

Countries like Finland, Denmark, and Norway are renowned in the global investment market for holding vast pension reserves and operating in a highly market-oriented manner.

Interestingly, on the eve of the recent U.S. stock market "crash," they sensed market risks and began to reduce their holdings in U.S. stocks in advance.

This "Dunkirk retreat" of European pension funds from the U.S. stock market has quietly begun.

Finland's Pension Fund Turns Bearish Early

Finland has a population of just over 5.5 million, yet it boasts the historically significant pension institution Veritas. According to data, the institution's external investment portfolio is expected to reach €4.7922 billion by the end of 2024, equivalent to approximately 39 billion RMB.

In Finland, Veritas is not a sovereign wealth fund; it is a national private pension insurance company that specifically provides pension services for small and medium-sized enterprises, individual entrepreneurs, and employees in certain industries. The funds it manages come from fixed contributions by employees and their employers.

However, the Finnish pension fund has a global perspective on stock investments and accurately reduced its holdings in U.S. stocks by the end of 2024.

According to its 2024 annual report: this pension fund reduced its holdings in the U.S. stock market from 46.2% to 24.1%, while simultaneously increasing its positions in European and Finnish stocks at the end of last year.

The pension fund further pointed out: although the U.S. economy remains the engine of global economic growth, the persistence of inflation above expectations in 2024 has suppressed expectations for interest rate cuts, particularly as the financial reports of tech giants and changes in interest rate policies have had a significant impact on the market.

In other words, this pension fund does not believe that the Federal Reserve will cut interest rates in the coming year as the market expects.

In fact, whether the Federal Reserve will cut rates in 2025 and the number of cuts is currently a "point of contention" among various funds.

More importantly: the timing of this 2024 operational report was written before the "catastrophic impact" of U.S. tariff policies on the global market, but it is clear that this sovereign institution sensed the risks and shifted its equity investments more towards Finland and other European regions.

This annual report provides a clear logic for "reallocating to Europe": after the European Central Bank cut interest rates, signs of economic recovery in Europe emerged, leading to an optimistic outlook, particularly for infrastructure investments.

Danish Institution Sells Off "Operators" Before Plunge

Compared to Veritas, the Danish private pension institution Akademiker Pension is in a more frantic "adjustment period."

This Danish pension institution achieved an overall investment return of 11.2% from its U.S. stock investments in 2024, with total fund assets growing to 184.735 billion Danish kroner (approximately 204.1 billion RMB).

Zhitong Finance noted that this pension fund's portfolio was quite optimistic about U.S. stocks in its 2024 report.

The institution stated: "In 2024, U.S. economic growth exceeded expectations, employment data was strong, and inflation declined, which is particularly favorable for the stock market... The strong performance of the U.S. market had a positive impact on Akademiker Pension's investment returns." However, the aforementioned optimism has recently taken a sharp turn. Market news indicates that the chief investment officer of this pension fund is considering a "fundamental rethinking" of the investment portfolio and plans to significantly reduce the strategic allocation to U.S. assets in the next six months.

More pointedly, this Danish pension fund dismissed a "management agency" that was entrusted with managing its U.S. assets in mid-March 2025.

This occurred just days before the sharp decline in U.S. stocks.

According to public information, this agency claimed that it terminated its cooperation with the U.S. asset management firm State Street Global Advisors due to ESG (Environmental, Social, and Governance) considerations. The latter manages $4.3 trillion in assets and is a major international asset management institution that has long been entrusted with part of the former's asset portfolio.

Ultimately, the two parties could not continue their cooperation due to incompatible ESG philosophies, leading the Danish pension fund to make the decision to "dismiss" it, which will certainly impact the agency's plans to invest in the U.S. market.

Norway Pension's "Delicate" Situation

Unlike the aforementioned private pension institutions, Norway, with its oil resources, has one of the largest government pension funds in the world—the Government Pension Fund Global (GPFG).

Data shows that the overall scale of this institution reaches 19 trillion Norwegian kroner (approximately 12 trillion RMB), ranking among the top globally.

Interestingly, the CEO of this sovereign investment institution, Nicolai Tangen, mentioned a "negative view" on U.S. tech stocks as early as January 2025.

At that time, this leader believed that if investors were willing to take a contrarian approach, they should consider selling U.S. tech stocks and private credit while increasing investments in China.

He also sharply pointed out that the concentration of funds in U.S. tech stocks is too high, especially for companies related to artificial intelligence, with risks hidden within.

However, due to the enormous size of this institution's assets, any reallocation actions are taken very cautiously. Yet, the fund's 2024 annual report (with an annual return rate of 13.1%) has already shown some signs.

This annual report disclosed that by the end of 2024, the Norway Pension's allocation to U.S. tech stocks was slightly below the benchmark index.

The underweight indicates that this investment team is shifting towards a more conservative attitude, rather than blindly chasing after gains