Angola Wealth Fund Planning to Manage More Assets Internally

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  • FSDEA seeks to improve internal management capacity this year
  • Most of sovereign wealth fund’s assets are in fixed income

Angola’s $4.8 billion sovereign wealth signaled a shift towards managing more of its own investments, the latest in a string of institutional investors seeking to cut costs and reduce their reliance on external managers.

Fundo Soberano de Angola, known by its Portuguese acronym FSDEA, plans to train staff to start managing more of its assets over the next four years and will inject more cash into the fund as oil prices improve, Chairman Jose Filomeno dos Santos said in an interview in London on Tuesday.

“Right now the fund is very passive,” Dos Santos said. “We want to expand capacity and be active.”

FSDEA is the latest in a line of wealth funds and institutional investors seeking to manage more of their own assets as management fees come under scrutiny. The California Public Employees’ Retirement System, the largest U.S. pension, and the $592 billion Kuwait Investment Authority both this month said they are developing plans to shift more investment in-house. The Abu Dhabi Investment Authority, the world’s second-biggest wealth fund, is using its own staff to invest in areas such as real estate and private equity.

FSDEA will initially take charge of securities such as stocks and bonds before taking over private equity investments, which are “more exclusive,” Dos Santos said. The funds assets, $1.18 billion of which is invested in fixed-income securities, are currently managed by Zug, Switzerland-based Quantum Global Investment Management Ltd.