Here at Investors Chronicle we’ve covered big tech, large-caps and income majors. This time, we’ve decided to go mega – mega-funds to be precise. Typically valued at over $5bn (£4bn), these investment behemoths wield significant influence in the financial markets. For sovereign wealth funds alone, their assets under management reached a staggering $8.1 trillion in 2018 and on average they own 5 per cent of all globally listed equities. Little wonder, then, that big capital has earned a reputation of being faceless and herd-like.
But some of the largest, most powerful and indeed most interesting of these investment vehicles stand out from their fellow leviathans. We have selected four of the more unique mega-funds to see what ordinary investors can learn from a church, a university, the world’s largest sovereign wealth fund and a Japanese billionaire. Over the ensuing pages, our writers will appraise the investment philosophies, portfolio composition, holdings and performance of four diverse mega-funds – the Church of England (CoE) investment fund, the Harvard University endowment, Norway’s Government Pension Fund Global (GPFG) and SoftBank’s $100bn Vision Fund. We aim to answer two key questions – what can ordinary investors learn from mega-funds and how easy is it to mirror their portfolios?
Upon first glance, comparing multi-billion-pound funds and the comparatively modest portfolios of private investors may seem ludicrous. Indeed, at the most basic level, it is often impractical for individual investors to copy the exact behaviour of mega-funds. Investment strategies such as venture capital and leveraged buyouts are not exactly available to the masses. It is doubtful that many people could afford to mimic the Vision Fund’s $100m minimum on its investments. But even without the same eye-watering levels of capital, there are valuable lessons to be gleaned from the shared behaviours these very different mega-funds display.