The role of sovereign wealth funds as activist or passive fund managers

Mietzner, Mark; Schiereck, Dirk; Schweizer, Denis

doi:10.1057/jam.2015.16

Cited by 18 publications

(9 citation statements)

References 41 publications

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“…Similarly, Fotak, Bortolotti and Megginson (2008) using a sample of 212 SWF acquisitions have documented a significantly positive 0.8% mean abnormal return around the announcement date. In line with the previous evidence, the empirical results of Mietzner, Schiereck and Schweizer (2015) suggest substantial positive stock returns in response to the announcement of SWF investments. For the sample of 147 transactions the cumulative average abnormal returns for targeted companies were 2.71% and 3.4% in (-1,+1) and (-5, +5) event windows, respectively.…”

Section: Do Investors Differently Value the Investment Of Sovereign Wsupporting

confidence: 88%

The Color of Government Money. Do Investors Differently Value the Investment of Sovereign Wealth Funds?

Urban

2017

E-Finanse

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The article aims at pointing out the differences in market reactions regarding the announcement of an investment of selected Sovereign Wealth Funds in companies listed on the London Stock Exchange. The research sample consists of 796 market transactions made by four selected Sovereign Wealth Funds. The author employed event study methodology to calculate the average abnormal returns and cumulative abnormal returns for each fund in subsamples. The empirical findings suggest that investors react differently to the information about a fund's investment. To the best of the author's knowledge, the literature does not provide any answer as to how the market reacts to information disclosure of individual funds. Therefore, this paper bridges the gap in the literature within this field.

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Section: Do Investors Differently Value the Investment Of Sovereign Wsupporting

confidence: 88%

The Color of Government Money. Do Investors Differently Value the Investment of Sovereign Wealth Funds?

Urban

2017

E-Finanse

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“…Knill et al (2012b) also report significantly negative raw abnormal returns for this time window, albeit of a much smaller magnitude (À0.027%). However, other studies, which assess the three-year performance of target firms' stock, do not lend support to this finding and report a mix of positive and statistically insignificant results (Dewenter et al, 2010;Kotter and Lel, 2011;Mietzner et al, 2015). No significant market-adjusted or market-model abnormal returns are reported for the four and five years event window (Dewenter et al, 2010;Fotak et al, 2008).…”

Section: Impact and Implications Of Swfsmentioning

confidence: 87%

“…The investment preferences of SWFs also merit some discussion. In the past, SWFs have been conservative, "long only" investors who prefer simple, listed debt and equity securities and steer away from complex financial instruments (Balding, 2008;Boubakri et al, 2016;Johnson, 2007;Mietzner et al, 2015). Being very risk-averse investors, a significant proportion of their investment has been directed towards developed countries where information asymmetry is low (Knill et al, 2012b;Miceli, 2013) and economic growth is high (Boubakri et al, 2016;Ciarlone and Miceli, 2016).…”

Section: Qrfm 135mentioning

confidence: 99%

“…There are three main findings. Firstly, the short term abnormal reaction to sovereign investment is significantly positive (Bortolotti et al, 2010(Bortolotti et al, , 2015Chhaochharia and Laeven, 2008;Dewenter et al, 2010;Fei et al, 2013;Fotak et al, 2008;IMF, 2008;Karolyi and Liao, 2010;Knill et al, 2012b;Lel, 2008, 2011;Mietzner et al, 2015;Ngoc, 2015;Raymond, 2009;Sojli and Tham, 2011;Sun and Hesse, 2009;Urban, 2017). All studies, which examine the short run impact of sovereign investment on target firms report a significantly positive market reaction ranging between 0.02% and 3.56% for the (À1,þ1) time window.…”

Section: Impact and Implications Of Swfsmentioning

confidence: 99%

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The impact and implications of SWFs: a systematic review of literature

Garg

Shukla

2021

QRFM

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Purpose This paper aims to systematically review all available evidence on the implications of sovereign wealth funds (SWFs) for various stakeholders (recipients of sovereign investment, home countries, which incorporate SWFs and the world at large) and offer future research directions. Design/methodology/approach A systematic literature review (SLR) technique is used to review 102 handpicked articles for the period 2005‐2019. Findings This review reveals that the literature on the impact of SWFs emerged only during the financial crisis of 2008–2011 and much of it is qualitative in nature. The literature is lopsidedly focused on the impact of SWFs on target firms and there has been a limited empirical investigation of the impact on other stakeholders. There is a lack of consensus in several areas, which calls for additional research. Few areas, which have not been addressed in the literature and can be taken up by future researchers include the impact of SWFs on macroeconomic fundamentals and stock markets of recipient countries, especially emerging economies; implications of SWFs for alternative asset classes; impact on the welfare of citizens and internationalization strategies of home countries; impact on initial public offerings and unlisted corporations; and impact on innovativeness, efficiency and corporate governance practices of target firms. Originality/value To the best of the authors’ knowledge, this is the first paper to use the SLR technique to review the literature on SWFs. It considers the impact of SWFs on all stakeholders and covers both qualitative and quantitative literature published over a long period of 2005‐2019. It also systematizes all available evidence on this theme and identifies important research gaps, which may be helpful for academicians, practitioners and policymakers.

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“…As for governance, Ferreira and Matos ( [37]) show that institutional investors are involved in the ongoing surveillance activity of target companies worldwide. However, SWFs generally follow passive strategies to avoid attracting public and governmental interest, even if they sometimes act like activist investors ( [38]). Besides, SWFs are widely known for their opacity compared to other types of investors (except for hedge funds, also known for their lack of transparency).…”

Section: State-owned Enterprise (Soe)mentioning

confidence: 99%

Sovereign Wealth Funds Definition: Challenges and Concerns

Ouni¹,

Bernard²,

Plaisent³

2020

aeb

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The main purpose of this paper is to bring a better understanding of the phenomenon of sovereign wealth funds (SWFs) by dealing with their definitional issues. Our objective is to understand why it would be difficult to have a standard and common definition of SWFs and how this definition concern could present a problem, especially for academic research. We analyzed the history of SWFs, their creation objectives, their sources of funding, the performance of their investments and their governance structure and compared them with other types of funds. We find that the lack of a common definition stems mainly from their: i) hybrid nature: SWFs are created and controlled by governments, but their investment strategies are similar to private funds; ii) high heterogeneity: SWFs have different structures, sources of funding and other creation objectives; iii) lack of transparency. Despite the establishment of Generally Accepted Principles and Practices for SWFs know as Santiago Principles, SWFs remain opaque structure and iv) similarities with other sovereign and private investors, especially in their investment strategies. These definitional problems could explain the lack of consensus on empirical studies about SWFs and the issues about the regulation of their activities. Otherwise, this study targets to contribute to the global debate on the regulation of their transactions, essentially by clarifying their subtle differences with other investment vehicles.

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The role of sovereign wealth funds as activist or passive fund managers

Cited by 18 publications

References 41 publications

The Color of Government Money. Do Investors Differently Value the Investment of Sovereign Wealth Funds?

The Color of Government Money. Do Investors Differently Value the Investment of Sovereign Wealth Funds?

The impact and implications of SWFs: a systematic review of literature

Sovereign Wealth Funds Definition: Challenges and Concerns

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