Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/53236 
Year of Publication: 
2009
Series/Report no.: 
Nota di Lavoro No. 25.2009
Publisher: 
Fondazione Eni Enrico Mattei (FEEM), Milano
Abstract: 
This paper examines the direct private equity investment strategies across sovereign wealth funds and their relationship to the funds' organizational structures. SWFs seem to engage in a form of trend chasing, since they are more likely to invest at home when domestic equity prices are higher, and invest abroad when foreign prices are higher. Funds see the industry P/E ratios of their home investments drop in the year after the investment, while they have a positive change in the year after their investments abroad. SWFs where politicians are involved have a much greater likelihood of investing at home than those where external managers are involved. At the same time, SWFs with external managers tend to invest in lower P/E industries, which see an increase in the P/E ratios in the year after the investment. By way of contrast, funds with politicians involved invest in higher P/E industries, which have a negative valuation change in the year after the investment.
Subjects: 
General Finance
Countries & Regions
Financial Services
JEL: 
G11
G15
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.