The Political and Governance Risks of Sovereign Wealth begins with a brief introductory history of the rise of sovereign wealth, from its early precursors in the United States to the large and more recently created funds of natural resource-rich countries. The introduction also provides a discussion of how sovereign wealth funds (SWFs) have been defined by both observers and the funds themselves and distinguishes SWFs from other important state-controlled enterprises, including state-owned enterprises (SOEs) and sovereign development funds (SDFs). The monograph then turns to the risks created by these funds. Section 2 reviews the domestic political risks associated with SWFs and how the domestic legitimacy of SWFs is tied to the substantive and procedural legitimacy in the creation and operation of the fund. Section 3 turns to the most publicized risk posed by SWFs: the potential that they could be politicized and used as mechanisms of mercantilism. This section also details how host countries have responded to acquisitions of domestic firms by foreign state-controlled enterprises by amending their procedures for reviewing acquisitions that pose potential threats to national security. Section 3 also distinguishes the investment behavior of SWFs from SOEs and discusses how the risks associated with SOE investment are typically of a greater magnitude than those posed by SWFs. Section 4 turns to domestic governance risks for SWFs and discusses the mechanisms that are designed to mitigate such risks. Section 5 examines SWFs' governance risks from an international perspective and how best practices like the Santiago Principles attempt to provide multilateral self-regulatory mechanisms.