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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
Article
Investment Strategy of the Temasek Holdings
Author(s)
Martin Vozar, Jozef Komornik
Full-Text PDF
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DOI:10.17265/1537-1506/2012.07.001
Affiliation(s)
Martin Vozar, Ph.D., Assistant Professor, Faculty of Management, Comenius University in Bratislava.
Jozef Komornik, Professor, Dean, Faculty of Management, Comenius University in Bratislava.
ABSTRACT
Sovereign Wealth Funds (SWFs) are generally known as investment funds owned by national governments and financed by the country’s foreign currency reserves (dollar, euro, and yen), often through their central banks or via direct investments. The study investigated the investment strategy of the Temasek Holdings as one of the most successful SWFs which is owned by the government of Singapore. Temasek Holdings was founded in 1974 to manage part of the government’s revenues. Present turbulent times create a big pressure on healthy investment strategy of the SWFs. But total shareholder return for Temasek since its inception in 1974 has been a healthy 17% compounded annually. The main objective of the paper is to focus on the role of the Temasek Holdings as a company managed on commercial principles with an aim to achieve long-term sustainable returns. The study also analyzed Temasek Holdings’investment strategy. The study provides answers to questions like: why Temasek is of the most successful SWFs and what is the fund risk management? Another part of the paper compares investment strategy of the Temasek Holdings with other SWFs. The study has been conducted mainly on the basis of literature survey, secondary information and with using various web sites and research paper. The analysis has been also based on disclosures appearing in the Temasek annual reports over the period from 2008 to 2010.
KEYWORDS
sovereign wealth funds (SWFs), Temasek, strategy, investment portfolio, asset under management
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