The Waning Ambitions of China’s $1.3 Trillion Fund Giant

China’s $1.3 trillion sovereign wealth fund spent years as one of the most sought-after investors in the world. It owned massive stakes in Blackstone Inc. and Morgan Stanley, struck deals with Goldman Sachs Group Inc. and plowed tens of billions of dollars into funds across Wall Street.

Today, China Investment Corp. is in retreat from the world’s largest economy, caught in the crosshairs as tensions with the US throw up investment roadblocks and Beijing seeks to lower risk by reining in the massive fund. CIC is reducing its exposure to US private assets, and had explored a sale of some fund stakes held with US private equity managers before pulling it, Bloomberg News reported this week.