《《Bernstein_Lerner_Schoar_The investment strategies of sovereign wealth funds》.pdf

Journal of Economic Perspectives—Volume 27, Number 2—Spring 2013—Pages 219–238 The Investment Strategies of Sovereign Wealth Funds† Shai Bernstein, Josh Lerner, and Antoinette Schoar overeignovereign wealth wealth funds funds have have emerged emerged as as major major investors investors in in corporate corporate and and real resources worldwide. Estimates of their size are difi cult, because disclo-real resources worldwide. Estimates of their size are difi cult, because disclo- SSsure regulations and practices differ widely from country to country. But insure regulations and practices differ widely from country to country. But in 2012, the Sovereign Wealth Fund Institute estimated that total assets of these funds2012, the Sovereign Wealth Fund Institute estimated that total assets of these funds were more than $5 trillion: that is, more than double the $2.1 trillion managed bywere more than $5 trillion: that is, more than double the $2.1 trillion managed by hedge funds (as estimated by Hedge Funds Research Inc., accessed July 21, 2012),hedge funds (as estimated by Hedge Funds Research Inc., accessed July 21, 2012), although it is only 2.3 percent of the $212 trillion in total global i nancial assetsalthough it is only 2.3 percent of the $212 trillion in total global i nancial assets (as estimated by McKinsey Global Institute 2011).(as estimated by McKinsey Global Institute 2011). AtAt i rst i rst blush, blush, sovereign sovereign wealth wealth funds funds might might seem seem an an excellent excellent opportunity opportunity for nations with high variance in public revenues to ensure steady cash l ow levelsfor nations with high variance in public revenues to ensure steady cash l ow levels and provide resources for long-term investments: for example, countries relying onand provide resources for long-term investments: for example, countries