The world's most powerful global Sovereign Wealth Funds (SWFs) confirm they are still awaiting the bottom of the market before committing to further substantial investments, according to a survey by Financial Dynamics International.

The survey found SWFs were unanimous in their view that they see their role as that of passive long term investors, with no desire to behave in an activist manner towards investee companies.

The key findings of the research included:

• SWFs are broadly adopting a very cautious approach to the current market, expecting better value to materialise later during the year


• SWFs are primarily interested in acquiring minority equity stakes in listed companies, with no desire to take management control, have board representation or act as 'activist' investors


• SWFs are particularly cautious with regard to supporting further bail-outs of distressed companies


• SWFs currently see the most attractive regions for investment being Brazil, China and areas of Central America

Charles Watson, group chief executive of Financial Dynamics International, said: "Our research confirms that whilst Sovereign Wealth Funds are currently adopting a very cautious investment approach to world markets, they are clearly poised to re-enter the global equity markets in the not too distant future with compelling valuation propositions beginning to present themselves across North American and Western European equity markets.

Our research has also determined that contrary to widespread perceptions, Sovereign Wealth Funds are primarily genuine long term passive investors who have no agenda to exercise management control or behave in an activist way.