The Abu Dhabi Investment Authority, one of the world’s biggest sovereign wealth funds, plans to continue betting on technology investments this year amid stellar growth in artificial intelligence.
An agile investment approach and active portfolio management helped it deliver strong returns and navigate market volatility and economic uncertainties last year, the fund said in its 2024 annual report on Wednesday.
“Technology and particularly the rise of artificial intelligence will remain at the forefront of public consciousness,” Sheikh Hamed bin Zayed, Adia's managing director, said.
“In coming years, the advancement of these technologies' capabilities, and their increasing integration into the fabric of the global economy, is poised to transform society.”
The fund broadened its “investable universe” to include asset classes such as private credit last year and actively managed private equity investments, as well as equities and equity-related opportunities.
At a portfolio level, the internally managed assets represented 65 per cent of Adia's total portfolio in 2024, with the remaining 35 per cent managed externally.
The sovereign fund said it remains “acutely aware that success in a rapidly changing world requires not only internal expertise but also strong external partnerships”.
Adia, which does not disclose its assets, invests on behalf of the Abu Dhabi government. It is the largest sovereign wealth fund in the Gulf, with assets touching $1.1 trillion, according to consultancy Global SWF.
Adia makes direct and indirect investments across asset classes such as equities, fixed income, infrastructure, private equity and property.
“Global markets in 2024 were a study in contrasts, in which economic, earnings, and technology-related optimism propelled risk assets to their second consecutive year of significant gains, even as geopolitical and structural risks mounted,” Sheikh Hamed said.
“Looking ahead, Adia is now entering a new phase in its evolution, shifting from laying foundational capabilities to refining and implementing data-driven investment decisions.”
Portfolio of investments
Developed equities accounted for the largest portion of Adia’s portfolio last year, ranging between 32 per cent and 42 per cent. Emerging market equities investments varied between 7 per cent and 15 per cent in 2024, according to the annual report.
Real estate accounted for 5 per cent to 10 per cent last year, while private equity investments accounted for 12 per to 17 per cent of its portfolio.
In terms of geographic spread, North America accounted for 45 to 60 per cent, Europe between 15 per cent 30 per cent, emerging markets for 10 per cent to 20 per cent, while 5 per cent to 10 per cent of Adia’s portfolio was concentrated in developed Asia, it said.
The Abu Dhabi’s fund's 20-year and 30-year annualised rates of return on a point-to-point basis were 6.3 per cent and 7.1 per cent, respectively in 2024, compared to 6.4 per cent and 6.8 per cent in 2023.
This year, Adia plans to the continue investing selectively in across assets classes including private equity and will seek to diversify its portfolio through alternative investments and private credit, it said.
In August, the fund said it is investing up to $1.5 billion in Singapore-based GLP to help the logistics investment company grow across markets. Adia, through one of its wholly owned subsidiaries, is investing $500 million in initial capital, which will help strengthen GLP’s financial position, the two companies said at the time.
In June last year, a subsidiary of the Abu Dhabi sovereign fund, together with global private equity investor Advent International, agreed to invest up to $3 billion for a minority stake in Fisher Investments, the money management company founded by billionaire investor Ken Fisher.
The investment by Advent and Adia of at least $2.5 billion valued FI at $12.75 billion, the Texas-based company said at the time.
