There's been a lot of talk recently about a Welsh Sovereign Wealth Fund, following the discovery of gas in the coal streams in the South Wales coalfield area.
So what is a 'Sovereign Wealth Fund'?
Well, according to the Sovereign Wealth Fund Institute, they are usually government-owned investment funds, structured either as a fund or a reserve investment corporation.
Oxford Economics notes that there are several different, sometimes overlapping, reasons:
macroeonomic stabilisation - SWF's can smoothe fluctuations in economies dependant on commodities that are exposed to sharp moves in world commodity prices
seeking higher returns - non-commodity based economies with significant reserves higher than needed for normal usage who can try to maximise returns
future generations - to create a pool of wealth for future generations long after the natural resources have been depleted
domestic industries - some SWF's have been used to restructure and encourage domestic industries.
According to IFSL, the world's largest SWF is in Abu Dhabi, whose Abu Dhabi Investment Council has assets of $875bn.
Perhaps the most famous, though, is Norway's 'Government Pension Fund - Global' which has a value of $380bn .
The country's petroleum revenues are the main source of the fund, along with net financial transactions from petroleum activities and returns from the Fund's investments. The fund pays for Norway's budget deficit.
The Finance Ministry is responsible for the fund, with Norges Bank having operational responsibility for investing in financial assets outside Norway, using Finance Ministry guidelines.
This is likely to be the model that a Welsh SWF would follow, with support for future generations and domestic industry assistance likely to feature high on any agenda of this sort.
More controversially, the formation of the China Investment Corporation, which bought 9.9% of Morgan Stanley last year, has led to accusations of state-ownership of companies, as SWF's of this nature, where the state play a more active role, have potentially far greater reach in terms of liquidity (i.e. they can call upon government reserves) than normal market-driven companies - hence American/free-market concern about buy-outs/bail-outs from CIC or the Russian Stabilisation Fund.
There are at least 52 different funds currently in existence, the largest twenty being worth more than 3 trillion dollars. However, the size of the global market for SWF's pales into insignificance with more standard funds such as pension funds or mutual funds, which, according to IFSL are worth nearly 9 times as much on a world basis.