Caisse de depot et placement du Quebec returned 9.1 per cent in 2015 as international equities, boosted with a decline in the Canadian currency, offset negative returns in your own home.
Net investment income at Canada’s second-largest pension fund manager was $20.1 billion in 2015 versus $23.8 billion last year, based on an argument issued Wednesday. Net assets rose to $248 billion as of Dec. 31 from $225.9 billion after 2014, the Caisse said.
Results beat the five.4 percent average increase of Canadian pension funds, as estimated in a January report by RBC Investor Services. Over 4 years, the Caisse said its weighted average annual return was 10.9 per cent – topping the ten percent average return of its own benchmark.
Under Ceo Michael Sabia, who took over in ’09, the Caisse continues to be increasing investments abroad while steadily boosting its contact with less liquid assets for example real estate to improve diversification. Today, almost 54 per cent from the fund manager’s exposure is outside Canada, with “inflation-sensitive” investments such as property or infrastructure accounting for about 17 percent of net assets.
“While not immunizing our portfolio against market movements, our strategy makes it more resilient in turbulent times,” Sabia said in the statement.
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Stocks Outperform
Equities were the best performing asset class for the Caisse last year, returning 11 percent on average. U.S. publicly traded stocks advanced 19 per cent while private-equity assets returned 8.4 percent, according to the statement. The Caisse’s $22.4-billion Canadian stock portfolio declined 3.9 per cent, under the 11 per cent decline from the Standard & Poor’s/TSX Composite Index.
Results overall benefited from about a 15 per cent decline in the Canadian dollar against its U.S. counterpart.
With net assets of $282.6 billion at year-end, the Canada Pension Plan Investment Board is the country’s largest pension fund manager.
Bloomberg News
