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Asset Allocation

Saudi Arabia’s SWF Seeds State Street Bond ETF With $200M

The exchange-traded fund tracks theperformance of the J.P. Morgan Saudi Arabia Aggregate Index.

By Michael Katz




The $925 billion Saudi Public Investment Fund has seeded a Saudia Arabia-focused exchange-traded fund managed by State Street Global Advisors with $200 million. According to the asset manager, the ETF is the first Saudi Arabian fixed-income undertaking for collective investment in transferable securities ETF made available in Europe.

According to a State Street fact sheet, the objective of the SPDR J.P. Morgan Saudi Arabia Aggregate Bond UCITS ETF is to track the performance of liquid, U.S. dollar-denominated sovereign and “quasi-sovereign instruments” and Saudi riyal-denominated Sukuk government bonds from Saudi Arabia. Sukuk government bonds are Islamic financial certificates that comply with Islamic, or Sharia, law.

The ETF, launched in December 2024, is a sub-fund of SSGA SPDR ETF’s Europe I and is listed on the London Stock Exchange and the Deutsche Börse’s Xetra in Frankfurt, Germany. The ETF tracks the newly created J.P. Morgan Saudi Arabia Aggregate Index and is intended to provide investors with access to Saudi financial instruments.

As of January 30, the fund held $248.9 million, which means the Saudi PIF’s investment accounts for more than 80% of the fund’s total asset value.

“PIF’s investment into the first internationally listed fixed-income Saudi ETF further deepens the Saudi market, while attracting investors and strengthening cross-geography partnerships, increasing international investment in Saudi Arabia,” Yazeed Al-Humied, PIF’s head of Middle East and North Africa investments, said in a statement.

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The ETF is the sovereign wealth fund’s second deal involving a Saudi Arabian ETF in the past several months. In October 2024, the Saudi PIF announced a memorandum of understanding with Japan’s Mizuho Financial Group to launch an ETF in Japan that invests in the Saudi Arabian equity market.

The One ETF FTSE Saudi Arabia Index was launched last December by Mizuho subsidiary Asset Management One. It had an initial market capitalization of more than $100 million, which according to Mizuhi, makes it the largest ETF on the Tokyo Stock Exchange that invests exclusively in the Saudi Arabian equity market.


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Home > News > Market Moves > Trump Signs Executive Order to Establish US Sovereign Wealth Fund
Market Moves

Trump Signs Executive Order to Establish US Sovereign Wealth Fund

The fund, about which there are few details, will be established by the Department of the Treasury and the Department of Commerce over the next 12 months.
By Matt Toledo



President Donald Trump signed an executive order on Monday to establish a U.S. sovereign wealth fund, to be established by officials from the Department of the Treasury and the Department of Commerce over the next 12 months. Secretary of the Treasury Scott Bessent told reporters the fund would be of “great strategic importance,” Bloomberg reported.  

The text of the executive order was not immediately available; executive orders are typically published in the Federal Register a few days after they are signed. 

Trump had campaigned on the idea of establishing a sovereign fund. Speaking at the Economic Club of New York in September 2024, Trump proposed a national sovereign fund, funded through tariffs, to invest in projects like manufacturing.  

Speaking to reporters in the Oval Office on Monday, Trump suggested that TikTok could be purchased by the sovereign fund. The social media app, removed from app stores pending a divestment from parent company ByteDance, was reported to have Oracle and Microsoft lined up as potential suitors. The price of the company is expected to be at least $40 billion, according to multiple estimates.

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It is unclear how the sovereign fund would be funded or where its distributions would go. Spokespersons for Treasury and Commerce did not immediately respond to requests for comment. News reports suggested the creation of the fund would require Congressional approval.  

“Investors and markets alike will closely watch how this fund differentiates itself from established models abroad,” says Michael Ashley Schulman, founding partner in and CIO of multi-family office Running Point Capital Advisors. “Any missteps in its early stages could have reputational and financial consequences that extend well beyond our borders.”  

In some states and in other countries, sovereign wealth funds are funded through government surpluses or certain taxes on the extraction of natural resources, including fossil fuels. 

Multiple U.S. states already have sovereign funds, such as the $80 billion Alaska Permanent Fund, which invests the state’s oil revenues. There are 21 state sovereign funds in the U.S. across 20 states; Texas has two.  

Schulman notes that the executive order is a bold, unconventional approach that could modernize how SWFs are managed, but it also raises questions about transparency, checks and balances, and investment selection criteria.  

“While the idea of a government-directed fund is possibly appealing in terms of national strategy, the key will be ensuring that governance and investment mandates are clearly defined to avoid politicization of asset allocation,” Schulman says. “The success of such a fund will depend on its ability to maintain independent, professional management, free from short-term political pressures.” 

There is no shortage of institutional assets in the U.S. As of the third quarter of 2024, public defined benefit pension funds alone managed a collective $6.25 trillion in assets, according to the Federal Reserve. 

Sovereign fund giants include Norway’s $1.74 trillion Government Pension Fund Global, Saudi Arabia’s $925 billion Public Investment Fund and the $1.3 trillion China Investment Corp.  

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