Saudi public investment fund invests $7 billion in US stocks

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Amid a highly volatile global capital market and growing fears of recession, Public Investment Fund, a sovereign wealth fund owned by Saudi Arabia, has decided to invest more than $7 billion in renowned US stocks such as ‘Amazon Inc, the parent company of Google, Alphabet Inc., and BlackRock.

The Public Investment Fund (PIF), which is one of the largest sovereign wealth funds in the world, has been under the control of Muhammad bin Salman, the West Asian country’s de facto ruler, since 2015.

Besides Amazon, Alphabet and BlackRock, the PIF also plans to invest in shares of JPMorgan Chase & Co, other gaming and technology companies.

Reports suggest that PIF has purchased additional shares in Meta Inc, PayPal Holdings Inc and Electronic Arts Inc platforms. Saudi Arabia’s sovereign wealth has large investments in technology and the financial sector.

PIF’s latest move to increase its sector investments and add new holdings to the portfolio signals that the investment vehicle plans to consolidate its position in the technology and financial sector.

A few years ago, at the start of 2020, the PIF bought a huge amount of stakes in US-based companies by spending billions of dollars. Later, due to the pandemic caused by the COVID-19 virus and the resulting lockdown, many stocks acquired by public investment funds suffered huge losses. This forced the sovereign wealth fund to sell a large portion of the shares it had purchased in the first months of 2020.

Reports suggest that the public investment fund owned and controlled by the Saudi royal family plans to double its total assets by 2025. PIF currently has influential stakes in social networking platform Twitter and gaming companies such as Electronic Arts, Take-Two Blizzard Interactive and Activation. The sovereign wealth fund also holds a 5% stake in Nintendo Co Limited, a video game company based in Kyoto, Japan.

In the second quarter of the current fiscal year, the value of PIF’s portfolio in the United States of America had decreased from $43 billion to $40 billion. The Public Investment Fund’s latest investment decisions to acquire stakes in tech and financial giants are seen as a plan by the Saudi fund to increase its position and stake in U.S. capital markets.

In 2021, the fund made a highly controversial acquisition of Premier League football club Newcastle United. The acquisition led to political and diplomatic crises between the UK and Saudi Arabia.

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