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Sovereign Wealth Funds Briefing 12.Feb 2015

Posted on 12 February 2015 by VRS |  Email |Print

The Carlyle Group’s David Rubenstein says that Middle Eastern sovereign wealth funds are making larger investments than ever before. Co-CEO David Rubenstein said during an analyst call that there has been a marked increase in commitments from sovereign wealth funds, including from Middle Eastern governments that are under fiscal pressure due to falling oil prices. Same goes for commitments from many Asian sovereign wealth funds that are facing domestic economic headwinds.
“The large sovereign wealth funds are now coming into the market… and making very very large commitments, larger than we’ve ever seen before” he said. “And I don’t think there is likely to be a diminution in that trend this year despite the fact that you may say, for example, “In the Middle East, because oil prices are down, won’t the sovereign wealth funds there be pulling back?’……………………………………….Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

Sovereign wealth funds are “a gigantic source of new investment” that are elbowing aside public pension funds in the private equity space, Carlyle Group co-CEO David Rubenstein said Wednesday. Such state-controlled funds increased to 37 percent of capital commitments at Carlyle last year, up from 17 percent a year earlier, Rubenstein said.
“I suspect that will continue. At the same time public pension funds are going down, relatively speaking. It was 28 percent; now it’s about 18 percent,” Rubenstein said during an investor conference call to announce the District-based firm’s 2014 financial results………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

As U.S. pensions such as California Public Employees’ Retirement System which pulled out of hedge funds in 2014, and New Mexico Public Employees’ Retirement Association which lowered its hedge fund allocation from 7% to 4%, sovereign wealth funds are becoming a larger target market for hedge funds. There is a segment of sovereign wealth funds that allocate to hedge funds to achieve specific investment goals.
For example, the Korea Investment Corporation (KIC) is a sovereign wealth fund that invests in hedge funds. One of KIC’s former chief investment officers Scott Kalb possessed a strong hedge fund background. Some other sovereign funds that commit capital to hedge funds include, but not limited: Abu Dhabi Investment Authority (ADIA), Australia’s Future Fund, Alaska Permanent Fund and Temasek Holdings………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

Norway’s sovereign-wealth fund bought a stake in 11 Times Square, a 40-story office tower in midtown Manhattan, in a deal the seller says values the building at $1.4-billion (U.S.). Norges Bank Investment Management purchased the 45-per-cent interest from developer SJP Properties and Prudential Financial Inc., according to SJP.
Foreign investors are snapping up real estate in New York City, pushing prices to records. Construction of the 1.1-million-square-foot (102,000-square-meter) skyscraper in Times Square began before the property market collapsed in 2008, without any space leased. It landed its first tenant in 2010, when it was one month from completion. It is now about 85 per cent occupied by tenants including law firm Proskauer Rose LLP and Microsoft Corp………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

The State Oil Fund of Azerbaijan Republic (SOFAZ) reports about drop in return on assets in 2014. According to SOFAZ, by the end of the last year return on assets fell to 1.47% (to 1.43% taking into account gold) against 1.77% in 2013 and 2.16% in 2012. Return on assets reached its peak in 2007 (4.49%), and over the last 10 year it was estimated at the average level of 2.56%.
Last year investments into bonds brought 0.7% of return, investments into shares – 0.3%, investments into deposits – 0.18%, using money market instruments – 0.01%, investments into real estate – 0.24%. Investments into gold were unprofitable (-0.05%)………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

The State Oil Fund of Azerbaijan (SOFAZ) did not buy physical gold over three quarters in a row (2nd, 3rd and 4th quarters of 2014). The Fund informs that as of 1 January 2015 it owned physical gold worth $1.15 bn which was equivalent to 3.13% of its investment portfolio ($36.7 bn).
“By the reported date SOFAZ had 30.17 tons of gold (970,146 ounces of gold),” SOFAZ said in a statement. This level of reserves conformed to the indicator by 1 April 2014………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

The State Oil Fund of Azerbaijan (SOFAZ) has called the euro the most successful investment in 2014. SOFAZ reports that last year its investments in euro (EUR 10.25 bn or 33.9% of assets) ensured for it 10.04% of yield in base currency, including 8.57% from currency difference.
At that, the operations in the base currency, the U.S. dollar, were unprofitable (-2.79%), including losses from exchange rate difference (-4.27%). The Fund kept $19.869 bn or 33.9% of its assets in the American currency. Assets in the British currency were estimated at 1.159 bn pounds (4.9% of all assets) and in the Australian currency- $214.9 (0.5%)………………………………………..Full Article: Source

Posted on 12 February 2015 by VRS |  Email |Print

As the oil tide recedes, oil-exporting sovereign entities have been treated with increasingly bearish sentiment by credit investors. Oil has seen its price halve since the end of July last year, from around $100 per barrel to around $50 today (WTI), compelling net exporters to rethink their budgets.
Large sovereign wealth funds look to have buoyed Norway and Saudi Arabia as their CDS spread sits largely unmoved………………………………………..Full Article: Source

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