Evaluating Asset Allocation Strategies for Sovereign Wealth Funds in Economic Uncertainty

As a portfolio manager for a Sovereign Wealth Fund (SWF) focused on both stabilization and long-term growth, you are currently tasked with evaluating the fund's asset allocation strategy amid prevailing global economic uncertainties. These uncertainties include fluctuating commodity prices, geopolitical tensions, and shifts in monetary policy across major economies.

Discuss the strategic asset allocation approaches that may be optimal for your SWF given the current economic climate. In your response, consider the importance of diversification, risk management, and the fund's liquidity needs. Additionally, address how the SWF's objectives might influence the choice of specific asset classes and investment vehicles.