The Abu Dhabi Investment Authority (ADIA) has released its 2023 Review, detailing the organisation’s activities and strategic outlook.
During 2023, ADIA increased its proportion of assets managed internally to 64% in 2023, up from 55% the previous year, largely due to enhancements in managing indexed equity exposures through its Core Portfolio Department.
ADIA also expanded its private equity allocation to 12%-17% of the total portfolio, up from 10%-15% in 2022. The portfolio adjustments were said to underpins ADIA’s strategy of seeking investment opportunities in areas of “strategic advantage”.
According to the government-backed fund, the MSCI World Index increased by 24% over the course of the year, with most gains occurring in the final months of the year due to increased risk appetite. Fixed-income markets mirrored equity performance, rising as investors anticipated rate cuts.
“It was a more nuanced picture for private assets as high interest rates complicated deal economics,” said Sheikh Hamed bin Zayed Al Nahyan, ADIA’s Managing Director. “Overall, ADIA was well positioned to capitalise on the strong gains in parts of these markets, while benefiting from dislocations in areas where conditions were more challenging.”
ADIA is the largest sovereign wealth fund in the Gulf and the fourth largest in the world, with estimated assets of $993 billion, according to Global SWF. As of December 31, 2023, ADIA’s 20-year and 30-year annualised returns were 6.4% and 6.8%, respectively, compared to 7.1% and 7.0% in 2022.
