- The Oxford Handbook of Sovereign Wealth Funds
- List of Figures
- List of Boxes
- List of Tables
- About the Contributors
- Introducing Sovereign Wealth Funds
- A Financial Force to be Reckoned With?: An Overview of Sovereign Wealth Funds
- Sovereign Development Funds: The Governance and Management of Strategic Investment Institutions
- From Financialization to Vulture Developmentalism: South-North Strategic Sovereign Wealth Fund Investment and the Politics of the “Quadruple Bottom Line”
- Sovereign Wealth Funds and the Resource Curse: Resource Funds and Governance in Resource-Rich Countries
- Sovereign Wealth Funds and the Global Political Economy of Trust and Legitimacy
- Sovereign Wealth Funds and Domestic Political Risk
- Sovereign Wealth Funds and Foreign Policy
- Sovereign Wealth and the Extraterritorial Manipulation of Corporate Conduct: A Multifaceted Paradigm in Transnational Law
- Sovereign Wealth Funds and Private Equity
- Co-Investments of Sovereign Wealth Funds in Private Equity
- The Use of Debt by Sovereign Wealth Funds
- Sovereign Wealth Fund Investment and Firm Volatility
- Sovereign Wealth Funds: Investment Choices and Implications Around the World
- The China Investment Corporation: From Inception to Sideline
- Investment Terms and Level of Control of China’s Sovereign Wealth Fund in its Portfolio Firms
- Strangers Are Not All Danger: Sovereign Wealth Fund Investment in the Energy Industry
- The Norwegian Government Pension Fund Global and the Implications of its Activities for Stakeholders
- Sovereign Wealth Fund Investments and Industry Performance: Evidence from Europe
- Spain and Sovereign Wealth Funds: Four Strategic Governance Types
- Sovereign Wealth Funds in Central and Eastern Europe
- Sovereign Wealth Funds in the Persian Gulf States
- The Australian Future Fund
- Is it Possible to Avoid the St Augustine Syndrome of Fiscal Procrastination?: The Case of Chile
Abstract and Keywords
The popular press and politicians have expressed concerns regarding the potential destabilizing force of sovereign wealth funds (SWFs). This chapter addresses these concerns by presenting results from the literature on the volatility and compensation of risk of SWF target firms and target markets. SWF investments (sales) are associated with a reduction (increase) in the compensation of risk for a three-year (five-year) term. Firm volatility decomposition suggests that it is mainly idiosyncratic risk that drives these impacts. The chapter reviews evidence and data that show the relationship between SWF investment and firm volatility depends on the investment horizon examined. It explains that the evidence is consistent with the view that the relationship between SWF investment and firm volatility is mainly attributable to idiosyncratic risk.
April Knill is the Gene Taylor/Bank of America Professor of Finance and the Associate Director of the BB&T Center for Perspectives on Free Enterprise at The Florida State University. She received her PhD from the University of Maryland at College Park in August of 2005. While pursuing her doctoral degree she worked at The World Bank as a ↵consultant. Upon graduation, she went to work at Florida State University. Her research interests are international finance, venture capital/private equity, and the intersection between law, finance, and politics. She has published in academic journals including (but not limited to) Journal of Business, Journal of Financial and Quantitative Analysis, Journal of International Business Studies, Financial Management, European Financial Management, Journal of Corporate Finance, Journal of Comparative Economics and Journal of Financial Intermediation.
Nathan Mauck is Assistant Professor of Finance at the Henry W. Bloch School of Management, University of Missouri—Kansas City. Professor Mauck’s research focuses on sovereign wealth funds, mergers and acquisitions, payout policy, corporate finance, ↵and behavioral finance. He has published in Journal of Banking and Finance, Journal of Behavioral Finance, Journal of Corporate Finance, Journal of Financial Intermediation, Journal of Financial Research, Journal of International Business Studies, Journal of Real Estate Finance and Economics, Financial Management, and Review of Quantitative Finance and Accounting among others. He received the Elmer F. Pierson Good Teaching Award (2015), UMKC Chancellor’s Early Career Award for Excellence in Teaching (2015), Bloch Favorite Faculty Member of the Year (2014) at the University of Missouri–Kansas City, and the College of Business Doctoral Teaching Award (2010) at Florida State University. Nathan received a BS in Finance from Kansas State University in 2006 and a PhD in Finance from Florida State University in 2011.
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