Abu Dhabi Investment Authority (ADIA), one of the world's
biggest sovereign wealth funds, said on Wednesday it would remain a patient,
long-term investor despite a drop in its returns last year due to slowing
In US dollar terms, the 20-year annualised rate of return on
ADIA's portfolio fell to 6.5 percent in 2015 from 7.4 percent the year before,
the fund said in its annual review. The 30-year rate of return slipped to 7.5
percent from 8.4 percent.
The drop was mainly the result of strong returns in the
mid-1980s and 1990s falling out of the rolling averages, and the recent returns
were consistent with historical levels, the review added.
"Against a backdrop of slowing global growth, ADIA's
investment strategy will remain focused on identifying long-term trends and
patiently growing capital," managing director Sheikh Hamed bin Zayed
Now in its 40th year, and headquartered in the UAE capital,
ADIA invests across more than two dozen asset classes globally. It does not
disclose the total size of its assets, but the US-based Sovereign Wealth Fund
Institute, which tracks the industry, estimates them at $792 billion.
ADIA continued to reduce the proportion of its assets
managed by external fund managers last year, to 60 percent, by strengthening
its in-house capabilities, the review said. In 2013, external fund managers
managed 75 percent of ADIA's assets and in 2014, 65 percent.
Also, ADIA reduced the proportion of its assets invested in
passively managed or index-replicating strategies to 50 percent in 2015 from 55
percent in the previous year.
While the review gave few financial details of ADIA's
investments in different asset classes, it said the fund expanded its real
estate and infrastructure portfolio.
Key acquisitions in 2015 included assets in the US warehouse
market, a 50 percent stake in a portfolio of Hong Kong hotels, an investment in
Germany's motorway services group Tank & Rast, and Transgrid, an electricity
transmission business in New South Wales, Australia.
Last year also saw the completion of a direct investment by
ADIA in ReNew Power, one of India's largest clean energy companies.
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