Sovereign wealth funds (SWF) have begun to move again.
With a global financial market showing signs of stabilization, SWFs are actively partaking in alternative investments, emerging market investments and domestic investments in order to make up for losses created in equity and bond investments last year.
The Korea Investment Corporation (KIC) is not an exception either. KIC was found to have posted an investment profitability of -13 percent in 2008.
According to the financial industry and “KIC’s Yearly Report for 2008” recently disclosed by KIC, KIC marked investment profitability of -13.71 percent, lower than its benchmark figure of -13.05 percent.
Especially, investment profitability in the stock sector logged -41.43 percent, down 0.11 percentage point from -41.32 percent of benchmark. Profitability in the indirect equity investment area recorded 0.22 percentage points lower than the benchmark, generating larger losses than the direct stock investment sector which posted profitability that is 0.20 percentage point higher than the benchmark.
Taking into account that the asset market experienced drastic adjustments worldwide last year, the losses aren’t relatively big when compared with the benchmark, but it was analyzed that SWFs suffered still huge losses due to the adjustments.
Global SWFs such as KIC and China Investment Corporation are continuously resuming investments. Amid such trends, a global asset market structure is expected to be reshaped as those SWFs are poised for alternative investments in emerging markets, diverting from pre-existing investments on advanced nations’ bonds and shares.
In terms of region, SWFs are conveyed to be stoutly expanding investments in newly emerging markets, shifting from investments centered on the U.S. and Europe.
[Eun-jung Kim / JYJ]
[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]