National Pension Fund Loses 182 Trillion Won Amid July Market Correction

The National Pension Fund saw its valuation drop by over 180 trillion won in July as domestic and international stock markets experienced significant volatility. However, the cumulative return since the beginning of the year remains at a robust 14%.

According to the National Pension Fund Management Headquarters, the fund's reserves totaled 1,684 trillion won at the end of July, down 182 trillion won from 1,866 trillion won a month earlier. The decline was primarily due to falling stock prices rather than cash outflows.

Domestic stocks experienced particularly large fluctuations. The valuation of domestic stocks held by the National Pension Fund fell from 543 trillion won at the end of June to 419 trillion won by the end of July, a decrease of 124 trillion won. During the same period, the valuation of overseas stocks also dropped from 661 trillion won to 624 trillion won, a reduction of 37 trillion won.

Despite these losses, the year-to-date cumulative return remains high. As of the end of July, the overall fund's return was provisionally recorded at 14.84%. Domestic stocks led with a return of 60.11%, while overseas stocks recorded a return of 10.72%.

Bond performance diverged from stocks, with domestic bonds yielding -3.36% and overseas bonds yielding 0.72%. Alternative investments generated a return of 4.09%.

The National Pension Fund attributed the increased market volatility to geopolitical tensions in the Middle East, inflation concerns, and uncertainties surrounding the sustainability of investments in artificial intelligence. Nevertheless, strong corporate earnings, particularly in the semiconductor sector, have helped maintain high returns in the stock segment since the beginning of the year.