Importance Under current economic circumstances, national governments which derive high income from resources, have to opt for an appropriate management model and operational principles of authorities charged with the effective use of superprofit so to form national budgets. Methods The article represents a comparative analysis of the structure and principles of managing sovereign wealth funds and illustrates the Reserve Fund of the Russian Federation, Russian National Wealth Fund and Pension Fund of Norway. Results The article enlists weaknesses in management of the Russian sovereign funds as compared with global practices. We provide our recommendations as to specific changes needed to improve the wealth fund management in the long run, and rationale for the changes. Conclusions and Relevance It is strategically important for national funds to follow ideas and rules at the initial phase. Executive authorities of funds should act as a mechanical trading system so to reach stable investment results within protracted time periods. Currently working and coming generations of Russians are sure to lose their significant income as a result of the Russian wealth fund deposits and high political and economic uncertainty in Russia. Decisions are made, with only short term circumstances taken into account, or not taken at all due to the aggravating situation in the world. We suggest Russia should draw upon experience of Norway in managing sovereign wealth funds.
Keywords: investment, sovereign wealth funds, wealth fund management, Reserve Fund of Russia, Russian National Wealth Fund, pension fund, Norway, Markowitz portfolio theory
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