Scott E. Kalb discusses how sovereign wealth funds differ from other institutional investors, and how these differences shape approaches to asset allocation, long-term investing, the active/passive decision, and risk and liquidity preferences. Kalb also debates whether the strategic investment approach of sovereign wealth funds (SWFs) provides an investing advantage or encourages massive misallocations of capital. In addition, Kalb discusses whether SWFs have become a potential source of systemic or geopolitical risk or an essential source of global economic stability and growth.