Sovereign wealth fund investment decisions: Temasek Holdings

Abstract

Sovereign wealth funds are government controlled investment vehicles that have recently been accused of politically motivated investment, lacking in accountability and lacking in transparency. Yet, there is little analysis of the actual investments made by sovereign wealth funds. We analyse the Singapore based investments of Temasek Holdings, a the Singapore government controlled sovereign fund, using its web site and the annual reports of a sample of large listed Singapore companies over the period 2000 to 2004. Firm size, director block-holding and the proportion of independent directors on the board have explanatory power over Temasek Holdings investments over the period. JEL Classification: G11, G23

The investment attractiveness of companies listed on the Warsaw Stock Exchange to Sovereign Wealth Funds

“…The other variables used in logistic regression estimations, although statistically significant, seem to have very little or no impact on the decision of which company to invest in. However, the fact that in all the models' variables, the total operating revenues, total assets, enterprise value, and market capitalisation were statistically significant might be, to some extent, interpreted as similar to the results obtained by Heaney et al (2011) and those of Kotter -Lel (2011), suggesting that SWFs prefer investing in large companies.…”

“…Summing up, SWFs' investments have generated considerable research interest; however, to date, the empirical literature has been relatively sparse, mainly due to the difficulties in obtaining comprehensive and systematic data (Heaney et al 2011) and the information gaps (Ciarlone -Micelli 2014). Since many SWFs do not disclose information about how and in what they invest, the answer to the questions about what determines target selection has therefore remained relatively unanswered.…”

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

“…Meanwhile, previous studies on this issue assumed at least to some extent a homogeneous reaction within the group of SWFs and on different capital markets. Moreover, the empirical results found in the literature are controversial with reference to the short versus long term, as well as to investment and divestment issues which are relatively sparse, mainly due to difficulties in obtaining comprehensive and systematic data (Heaney, Li & Valencia, 2011) as well as information gaps (Ciarlone & Micelli, 2014). In the case of short-term market reaction to the SWF investments, a great number of studies are relatively consistent.…”

The impact of sovereign wealth fund ownership on the financial performance of firms: the evidence from emerging markets

“…Beck & Fidora, 2008;Sun & Hesse, 2009;Sedláček, 2010;Quadrio Curzio & Miceli, 2010;Urban, 2011;Jiránková, 2012;Ćusović, 2012;Castelli & Scacciavillani, 2012;Alhashel, 2015), many questions concerning the fi nancial aspects of funds' activities still remain relatively unanswered. Moreover, the empirical results found in the literature are controversial with reference to the short versus the long term, as well as to investment and divestment issues which are relatively sparse, mainly due to diffi culties in obtaining comprehensive and systematic data (Heaney, Li, & Valencia, 2011) and information gaps (Ciarlone & Micelli, 2014). Knill, Lee and Mauck (2012), looking at the at risk-reward performance of target companies, argue that SWFs do not bring benefi ts to the companies they invested in, as other institutional investors do.…”