- Sovereign Wealth Funds now make up record 38.9% of Earth’s largest 100 asset owners
- Just the top 20 global asset owners now hold US$12.9 trillion, as concentration grows
- World’s 20 biggest asset owners are investing more in tech – citing importance of AI
LONDON, November 27, 2023 – Sovereign wealth funds now make up a record share of assets among the largest 100 global asset owners, according to new research by the Thinking Ahead Institute.
Sovereign wealth funds (SWFs) now make up 38.9% of total assets among the world’s largest 100 asset owners (the ‘AO100’). In absolute terms, sovereign wealth funds within the AO100 now represent US$9.1 trillion. This has risen as a proportion due to a slower correction in collective assets among turbulent markets – after SWFs saw the combined effects of relative investment performance and new inflows outperform over the last twelve months compared to other types of asset owner.
As a result, pension funds only just retain the majority share of AUM among the largest 100, with the combined assets of pension funds making up 52.8%, while outsourced CIOs and master trusts are responsible for the remaining 8.3% of total AUM in the AO100.
This marks a clear decline over the medium term. Five years ago, pension funds made up more than 60% of the AO100, while SWFs represented 32% or less than one third.
Taken as a whole, the world’s 100 largest asset owners are now responsible for US$ 23.4 trillion as of the end of 2022; experiencing a decline of nearly 9% compared to the previous year when this stood at US$25.7 trillion for the largest 100 asset owners at the time.
Other findings from the full study by the Thinking Ahead Institute – which provides key insights and trends on the top 100 asset owners in the world – include a growing concentration of assets at the very top of the rankings across all types of organisation, and differences in investment allocations.
The very largest 20 asset owners in the world now have a total of US$12.9 trillion alone – meaning the largest 20 represent 55.2% of the total AUM in the top 100. This concentration at the top of the rankings is caused by a slower decline in asset values among the largest asset owners, in the preceding twelve months. In fact just the top five asset owners accounted for 24.4% of total AUM in the study with US$5.7 trillion
The Government Pension Investment Fund of Japan remains the largest asset owner in the world, with an AUM of US$1.4 trillion alone. The top three also includes the two largest sovereign wealth funds. Norway’s Norges Bank Investment Management comes second with AUM of US$1.3 trillion while China Investment Corporation with US$1.1 trillion is third globally.
North America accounts for 33.9% of total AUM in the AO100 study, making it the largest region by asset value, closely followed by Asia-Pacific with 33.7% of total AUM. EMEA represents 32.4% of total AUM.
Jessica Gao, director at the Thinking Ahead Institute, comments: “Asset owners from sovereign wealth funds to pension funds have navigated a year when volatility and uncertainty in the global economy have been at their highest in a generation – with often divergent outcomes.
“The disruption caused by elevated inflation and increased interest rates has affected equity and bond markets on a global scale, putting extra pressure on asset owners to reassess and adjust their strategies. The shift from an era of low inflation and interest rates has given a rise to a new macroeconomic landscape that demands a fresh understanding and management approach. This is impacting different types of asset owner in different and unexpected ways.
