President Trump has just signed an executive order to set up a federal sovereign wealth fund.
Trump orders the American treasury and commerce departments to create the fund, and says it can be used to buy the popular social media platform Tiktok.
Treasury Secretary Scott Bessent says that the fund will be established in the coming 12 months, Bloomberg reports.
Sovereine power funds are investment funds in the hands of the government.
They usually invest surplus income, often from natural resources such as oil, to grow wealth for the future.
These funds diversify investments worldwide about shares, bonds, real estate and other assets.
Their goal is to offer financial stability in the long term, economic growth and protection against economic shocks.
Although states such as Alaska have had their own sovereign power funds for years, the federal government itself has never used one.
A number of countries already have sovereign power funds, including Norway, China, United Arab Emirates, Saudi -Arabia, Singapore, Kuwait, Qatar, Australia, Russia, South Korea and Chile.
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