Analyze ONE sovereign wealth fund

Assignment Brief:
Active portfolio managers continue to come under increased pressure from cheaper passive alternatives
due to their inability to consistently outperform their chosen benchmark in a cost-efficient manner.
Despite this, the investment management industry still seeks to find pricing inefficiencies in the pursuit of
excess market returns. Sovereign Wealth Funds for the most part remain a continued prescriber to active
management investment strategies despite this changing market environment.
The assignment will require the student to analyse ONE sovereign wealth fund from the below
prescribed list of chosen funds to consider the following:
• The specific investment objectives, investment strategies and investment constraints of the
chosen fund.
• The extent to which the current portfolio is aligned to the economic prosperity of the sponsoring
country and how this informs the investment decisions.
• A discussion on the recent developments of the chosen funds asset allocation and to what extent
recent global monetary and fiscal policies have been contributory factors in these decisions.
• Consider whether the wealth fund has increased the use of passively managed vehicles and
external active asset managers in the provision of cost-efficient alternatives or additional valueadded expertise respectively. Discuss to what extent they have benefitted from such decisions.
• An analysis of their stock selection research methods and any particular style biases they may
exhibit from their active management decisions including a consideration for Socially Responsible
Investing and/or ESG.
Sovereign Wealth fund List
• Irish Strategic Investment Fund
• Investment Corporation of Dubai
2
Marking Scheme:
– Suitably demonstrate an understanding of the wealth funds investment objectives,
strategies and constraints. 15%
– Show an understanding of the investment process and how it is linked to specific sponsor goals.
20%
– Develop an appreciation for the funds asset allocation developments in the past 5 years and the
main market drivers for these developments 25%
– Evaluate the use of external passive and active managers (if any) in the delivery of their
investment objectives and the extent to which they have added value. 10%
– Evaluate the stock selection research methods of the fund, particular style biases and SRI
investing considerations. 15%
Appropriate & professional presentation 10%
– Academic work, structured in a clear, concise and logical manner, evidence of additional research
beyond tutor provided material all referenced correctly using the Harvard Referencing System5%

Total 100 Marks
Learning Outcomes Addressed in this Assignment:
1. Demonstrate an ability to analyse investment objectives and strategies given due consideration
for the underlying fund constraints.
2. Be able to interlink capital market expectation to asset allocation decisions and how economic
cycles and policy decisions can impact future return expectations and therefore asset allocation
progression.
3. Consider the relative merits of passive versus active management.
4. Consider stock selection methods and style biases in managed portfolios.