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Alaska SWF Flat for Fiscal Year 2012



According to the permanent fund’s press release, “According to preliminary data released today by the Alaska Permanent Fund Corporation, the Permanent Fund’s investments returned 0.02 percent for the fiscal year ending June 30, 2012, and closed with a value of $40.3 billion. This was up $193 million from the end of the prior year, and the Fund outperformed the composite benchmark return of -0.2 percent.

“It was a volatile year for the global stock markets, particularly overseas markets,” said Michael Burns, CEO. “Stocks make up about half of the Fund’s investments, so they had the largest impact on our performance. However the bond and real estate portfolios performed quite well over the course of the fiscal year, helping mitigate the poor performance from stocks and creating a positive return for the Permanent Fund.”

In the first quarter of the fiscal year stock markets were sharply down, feeling the drag of slow growth domestically and political and economic turmoil overseas. Markets then appeared to return to normal, rallying through the second and third quarters, especially in the U.S. But overseas markets were shaken by continuing woes and fell into double digit losses in the fourth quarter, creating a net negative return for the stock portfolio despite positive returns in the U.S. markets.

The Fund’s U.S. stock portfolio returned 2.3 percent. The non-U.S. portfolio returned -14.6 percent while the global portfolio returned -4.7 percent.

Continued concerns over the stability of Eurozone sovereign debt, along with slowing growth in emerging market countries drove investors to the U.S. As a result, U.S. bonds returned 7.8 percent. Compared to stocks, even non-U.S. bonds still seemed safe to investors by comparison, and the portfolio returned 6.5 percent.

Real estate also performed well over the year, and preliminary results show the Fund’s investments returned 11.4 percent. Final audited performance results for real estate and the other asset classes will be available at the Board’s annual meeting in September.

The Fund’s absolute return portfolio was flat at 0.4 percent for the fiscal year. This portfolio includes funds that specialize in absolute return strategies, distressed debt, mezzanine debt and other directed investments. The real return portfolio returned 5.7 percent for the period. This portfolio is comprised of five portfolios, with each manager allowed to set their asset allocation within the risk parameters set by the APFC. This allows them to select from the same range of asset types found within the rest of the Permanent Fund. Private equity returned 9.8 percent for the fiscal year and infrastructure returned -8.4 percent.”

Read more: Alaska Permanent Fund Press Release

Trump’s First Year Cements M&A Boom, Will it Last?



Despite a recent downdraft in the stock market, economic signs suggest that the nation has prospered since U.S. President Donald Trump was elected. His first year was marked by mega mergers and acquisitions, and renewed hopes for deregulation and tax relief. M&A deals totaled US$ 1.2 trillion in the year since Trump was elected in a stunning upset, which compelled former U.S. Secretary of State Hillary Clinton to pen the book, “What Happened.” The total number of deals also set a record. In sum, nearly 13,000 deals have been made between the election and the end of the 2017 calendar year. Business sentiment was clearly buoyed by Trump’s election, with investors and organizations cheering the business-friendly environment to come. Unemployment dropped to a low of 4.1% in 2017, before further falling to 3.7% in 2018. This has been described as “full employment.” The unemployment rate will only fall to a certain level because there are always employees looking for something new and leaving jobs they hold. The stock market has also done well under Trump. Not since the 1960’s was volatility as low as it was during the early part of his presidency. Even with the swoon over the last several weeks, the market is still up substantially since Trump’s election. Despite consistent pessimistic headlines on major financial news sites, Amazon is still moving ahead with its massive #2 headquarters, while Google is planning a gigantic development in his core home of Mountain View, California.

Yet, controversy swirls as former U.S. President Barack Obama declared, “When you hear how great the economy is doing right now, let’s just remember when this recovery started.” [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Ayatollah Khamenei Orders Central Bank Governor to Increase Value of the Rial



Iran Supreme Leader Ayatollah Ali Hosseini Khamenei requested the Central Bank of Iran to boost the value of the Iranian rial, according to the central bank’s governor. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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SWFI First Read, December 8, 2018



UBS Trumbull Property Fund Faces Redemption, MassPRIM Benefits

Massachusetts Pension Reserves Investment Management Board (Mass PRIM) Allianz Real Estate, and Beacon Capital Partners acquired the Exchange Place skyscraper in Boston has been sold for US$ 845 million from UBS Realty Investors. UBS Realty, part of UBS Group AG, acquired the 53 State Street office tower in December 2011 from Brookfield Office Properties for US$ 610 million. Tenants of the property include Morgan Stanley, The Boston Globe, Hill Holliday, and Nixon Peabody. The property was a major holding of the open-ended fund called UBS Trumbull Property Fund.

MassPRIM will own 49% of the property.

Tower Hamlets Pension Fund Awards Equity Protection Mandate to Schroders

In September 2018, Tower Hamlets Pension Fund awarded Schroders with a mandate for a risk management solution for £700 million in an equity protection strategy. This covers about half of the fund’s portfolio of £1.4 billion. The pension fund’s consultant is Mercer.

Ebola Spreads in the Congo

The second-largest Ebola outbreak in world history has spread to Butembo, a city in eastern Congo with more than 1 million inhabitants.

NZSF Board Member Joins Board of NZX

The NZX (New Zealand Stock Exchange) board of directors named Lindsay Wright as lead independent director. She is Deputy Chair of the Board of the Guardians of the New Zealand Superannuation Fund.

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