What is the 'Alaska Permanent Fund'

The Alaska Permanent Fund is a fund which originates from surplus revenues gained from the development of Alaska's oil and gas reserves. Managed by The Alaska Permanent Fund Corporation, a state-owned corporation, the fund’s value was $64 billion as of March 27, 2018. 

The Alaska Permanent Fund is a fund that pays an annual dividend to all Alaska residents who meet eligibility requirements. 

BREAKING DOWN 'Alaska Permanent Fund'

The Alaska Permanent Fund is a sovereign wealth fund  (SWF), which invests in a wide array of asset classes, including domestic stocks, U.S. bonds, global stocks, real estate and private equity. Management of the fund is by the Alaska Permanent Fund Corporation. After completion of the Trans-Alaska Pipeline System, which introduced Alaskan oil to the market in 1976, Alaska’s government added a state constitutional amendment setting aside a share of oil revenues for future generations of Alaskans. The revenues from these natural reserves form the basis of the Alaska Permanent Fund.

The Alaska Permanent Fund and Dividends

The Alaska Permanent Fund pays out yearly dividends, called the Permanent Fund Dividend (PFD). To qualify for a dividend, the Alaska residents must have lived a full calendar year in the state and must intend to remain in Alaska. However, several factors may exclude an individual from eligibility. If during the qualifying calendar year, an individual is sentenced as a result of conviction of a state felony, incarcerated as a result of a state felony, or convicted of specific misdemeanors, they may no longer be eligible to collect the PFD.   

Based upon a five-year average of the Alaska Permanent Fund's performance, the dividend varies widely depending on the stock market among other factors. Using the original formula 2018’s dividend would be $2700, but was reduced to $1600 through legislative action. The most significant payout was in 2015 at $2072. In 2008, the second largest payment of $2,069 came with an additional $1,200 through Senate bill number 4002, signed by then-governor Sarah Palin.

Other Sovereign Wealth Funds

There are nine states besides Alaska which operate sovereign wealth funds. The funds help to finance specific services or to provide general revenue to the state government itself. Alabama, Alaska, Louisiana, Montana, New Mexico, North Dakota, Oregon, Texas, Utah and Wyoming all operate sovereign wealth funds.

A sovereign wealth fund consists of pools of money derived from a country or state’s reserves, set aside for investment purposes to benefit the country or state’s economy and citizens. The funding for a sovereign wealth fund comes from central bank reserves which accumulate as a result of budget and trade surpluses. Funds also generate from the exports of natural resources.

The most massive sovereign wealth funds are Norway’s Government Pension Fund, the United Arab Emirates’ Abu Dhabi Investment Authority, and China’s China Investment Corporation.

  1. Sovereign Fund Of Brazil

    The Sovereign Fund of Brazil is a sovereign wealth fund for the ...
  2. New Mexico State Investment Office ...

    The New Mexico State Investment Office is the investment office ...
  3. Revenue Regulation Fund

    The Revenue Regulation Fund is a sovereign wealth fund for the ...
  4. Permanent Portfolio

    The permanent portfolio is an investment portfolio designed to ...
  5. SAMA Foreign Holdings (Saudi Arabia)

    SAMA Foreign Holdings is a sovereign wealth fund (SWF) controlled ...
  6. Permanently Restricted Assets

    Permanently restricted assets are funds of a nonprofit organization ...
Related Articles
  1. Personal Finance

    How Much Money Do You Need to Live in Alaska?

    Learn the average costs for necessities in Alaska, and understand how much money you need to live as a student, professional and unemployed job seeker.
  2. Investing

    An Introduction To Sovereign Wealth Funds

    Countries use sovereign wealth funds to stabilize their economies, but these investments can lack transparency.
  3. Investing

    Alaska Air Wins Bidding War for Virgin America (ALK, VA)

    A hard-fought bidding war between Alaska Air and JetBlue Airways has come to an end, with Alaska confirming early Monday morning that it will acquire Virgin America for $2.6 billion
  4. Investing

    Alaska Airlines to Close New York Base

    Alaska Airlines, the fifth-largest airline in the U.S., is pulling out of New York to reinforce its West Coast fleet
  5. Insights

    Alaska, Virgin America Report December Traffic Statistics (ALK)

    Alaska Air Group has released December operational results for its five subsidiary airlines.
  6. Investing

    How Mutual Fund Managers Pick Stocks

    Learn about how mutual fund managers choose stocks based on the type of funds they manage and the investment goals of the funds' shareholders.
  7. Investing

    The 5 Best American Funds

    Discover five of the best-performing mutual funds offered by American Funds, based on the funds' five-year average annualized returns.
  8. Investing

    The Risks Of Sovereign Bonds

    Sovereign debt can play an important role in providing international diversification to individual investors.
  9. Financial Advisor

    5 Characteristics of Strong Mutual Fund Shares

    Discover some of the basic characteristics shared by good mutual funds that investors can use to help them in selecting funds.
  1. Where does a hedge fund get its money?

    Learn how a hedge fund is structured and how the managing partner of the fund finds and solicits investors with large amounts ... Read Answer >>
Trading Center