Malaysia's sovereign wealth fund seeks greater portfolio resilience in volatile markets

Malaysia's sovereign wealthiness money Khazanah Nasional is rebalancing its concern portfolio for greater resilience against marketplace volatility, according to its managing director.

Khazanah's nett plus worth declined 5% to 81 cardinal ringgit ($17.4 billion) successful 2022 from a twelvemonth ago, deed by planetary marketplace downtrends, the money said successful March. The Kuala Lumpur-based money invests much than fractional of its portfolio successful nationalist markets.

"What we are focused connected doing present is to look astatine however we tin beryllium a spot much resilient successful the market," Khazanah's managing manager Amirul Feisal Wan Zahir told CNBC Monday connected the sidelines of the Energy Asia league successful Kuala Lumpur.

"Looking astatine the volatility successful the market, we are inactive successful the process of rebalancing our portfolio," helium added.

Khazanah posted a 1.6 cardinal ringgit ($343 million) nett net successful 2022 — much than doubling its nett net from the twelvemonth earlier and a fourth-straight yearly nett net aft an unprecedented plunge successful 2018.

In comparison, the MSCI World scale saw a much than 18% slump successful 2022 and the MSCI Emerging Markets scale dived 20% successful the aforesaid period.

As of extremity 2022, Khazanah said 55.9% of its portfolio was invested successful nationalist markets successful Malaysia, with 13.4% invested successful nationalist markets overseas. Nearly a 4th of its portfolio was invested successful backstage markets, much than fractional extracurricular Malaysia, with 8% invested successful existent assets.

"There is really a batch of imaginable successful deploying assets," said Wan Zahir, pointing to concern opportunities successful volatile marketplace environment.

"In this existent moment, erstwhile you look astatine concern consolidation ... oregon we cognize determination is simply a rising complaint environment, and corporates volition get squeezed — particularly erstwhile you look astatine user oregon highly leveraged companies," helium said.

Inflation rates person stayed persistently precocious globally contempt aggregate involvement complaint hikes arsenic cardinal banks question to rein successful years of super-easy monetary argumentation pursuing the 2008-2009 fiscal crisis. Rate hikes and rising yields person combined to wounded galore companies.

"But it does archer CEOs and corporates — however tin I really trim my costs?" Wan Zahir said.

"So erstwhile you look astatine areas specified arsenic concern services, you could get opportunities successful the backstage equity abstraction determination arsenic well."