Investment Council or ADIC System †Free Samples to Students

Question: Discuss about the Investment Council or ADIC System. Answer: Introduction: Abu Dhabi Investment Council or the ADIC is an investment arm of Abu Dhabi government. It is primarily a sovereign wealth fund that is owned by the UAE (United Arab Emirates). Further, it is liable for investing the surplus funds of the government through an internationally diversified investment strategy. It intends to target positive capital returns with the help of an expansive portfolio of active investment management strategies and highly widespread class assets (Bloomberg, 2018). The council is also entrusted with the power to mandate the direct investment to widen the economic base of Abu Dhabi and facilitate the global development of domestic companies. The council initiated its operations from April 2007 and intends on becoming an efficient institution of managing assets and creating returns as well. ADIC invests in real estates, private equity, infrastructure, public equity, hedge funds, and fixed income markets throughout the world. For the purpose of its public equity investments, the council intends to invest in small cap and large-cap companies. Moreover, the councils fixed income investment is primarily diversified credit and emerging debt securities that are associated with sovereign and international inflation (Gulf news UAE, 2018). Besides, the councils investment of hedge funds comprises of investment in funds that further invests across hedge equity strategies, relative value strategies, event-driven strategies, macro strategies, and systematic CTA. For private equity investments, ADIC makes secondary, direct, and fund of fund investments in private markets and both listed and unlisted companies throughout the world. Its other investments include infrastructure and real estates as well. Abu Dhabi needed a new vehicle to invest few of its oil receipts in order to compete with Abu Dhabi Investment Authority that was regarded as governments longstanding arm of investment and largest Arab institutional investor. Since the risk of government was getting higher day-by-day, ADIC was formed with a purpose of setting up a balanced portfolio of investments throughout all classes and sectors of assets, thereby diversifying the governments risk. Nonetheless, the council was formed to differentiate itself from ADIA with a particular focus on investments within the Middle East together with facilitating international investments (ADIC, 2018). Hence, this was the major purpose behind the formation of Abu Dhabi Investment Council but this does not mean replacement of ADIA as a whole. The structure of Abu Dhabi Investment Council is just like a sovereign wealth fund institute that was formed with the purpose of investing the governments fund all across the globe. However, the managing director of the council facilitated in restructuring the council by making it part of the Mubadala Investment Company Group. With such restructuring process, a world-class investment scale of investments can be established, thereby enhancing the attempts of Abu Dhabi in generating more revenues and enhancing its competitive position as a whole (ADIC, 2018). Under such new law, the directors of Mubadala Investment Company Group will become the Board of directors of the council that will continue to operate like it was before but only on a grand scale. References ADIC. (2018). Abu Dhabi Investment Council (ADIC). Retrieved from https://www.abudhabi.ae/portal/public/en/departments/adic;jsessionid=4aphdfofMouWL51GP6-Hre8Pf_cqK5cnNyvBCar8x3jJVX97qBTs!455785616!-380889922!1522053544479 Bloomberg. (2018). Company Overview ofAbu Dhabi Investment Council. Retrieved from https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=53306153 Gulf news UAE. (2018). UAE President orders restructuring of Abu Dhabi Investment Council. Retrieved from https://gulfnews.com/news/uae/uae-president-orders-restructuring-of-abu-dhabi-investment-council-1.2192170