Global Investing

There’s oil in them thar wealth funds

January 14, 2010

Some interesting new data on sovereign wealth funds from State Street Global Advisors, a huge fund firm that does a lot of business with them. Most interesting, perhaps, is that the vast majority of sovereign wealth fund money comes from oil and gas revenues rather than from countries building up large foreign reserves from other trade, eg China.

  • – The U.S. firm identified 37 major sovereign wealth funds worth a total of $3 trillion.
  • – More than two-thirds, or 70 percent, of that money came from oil and gas interests.
  • – Of the 37, all had at least $3 billion in assets.
  • – Eight of them had more than $100 billion.
  • – Only 13 of the 37 funds were not based on commodity wealth.
  • – Asia had the largest number of SWFs at 13.
  • – The 10 funds based in the Middle East had nearly half the wealth, or 46 percent, between them.

These funds, incidentally, are becoming more like mainstream investment companies by the day. State Street says they are eventually going to turn into the equivalent of large public sector pension funds and could well start becoming more active as shareholders in companies in which they invest.

Comments
2 comments so far | RSS Comments RSS

Speculating on Oil ,Natural gas has made billionaires of hedge funds ,SWF,Mutual funds etc in Russia,Saudi Arabia,Iran,Venezuela etc and so many investment banks have made hundreds to thousands of billions of dollars in assets and wealth.

Posted by juggie26 | Report as abusive
 

The “Oxford Sovereign Wealth Funds Project,” Oxford University, discussed the analysis of SWF post-crisis investment strategies and the views of the growing trend of cooperation between them. According to comments by Dr. Alexander Mirtchev, the increased strategic cooperation between SWFs in emerging markets reflects the potential advantages that SWFs achieve in pursuing such strategies. Just like multinationals, in certain industry sectors SWFs are able to achieve more, as they may not be bound by anti-trust and other restrictive regulatory policies. In addition, joint project development allows better structuring of the investment activities of SWFs, making them a more desired and systemically important investor, in particular in the context of global economic security after the crisis.

Posted by Strick12 | Report as abusive
 

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