Canada's Biggest Pension Fund Delivers 1.5% Quarterly Return
August 11 2016 - 01:20PM
Dow Jones News
Canada's largest pension fund generated a net investment return
of 1.5% in its fiscal first quarter, driven by private-market
holdings, investments in North American publicly traded equities
and its exposure to debt markets.
Canada Pension Plan Investment Board said Thursday that net
assets for the quarter ended June 30 totaled 287.3 billion Canadian
dollars ($219.9 billion), up from C$278.9 billion at the end of its
prior fiscal quarter. Investment income generated C$4.1 billion of
the C$8.4 billion increase in assets, and pension contributions
accounted for the remainder.
CPPIB measures its performance on an annual basis against an
internal benchmark based on returns from a mix of asset classes,
but it doesn't disclose quarterly returns for that index.
The Canadian fund's latest quarterly results come as the Brexit
vote in late June sparked wild swings in global equities and as
renewed concerns over oversupplied energy markets weighed on
investor sentiment. The Stoxx Europe 600 Index fell about 2.3%
during the quarter ended June 30, while Canada's S&P/TSX
Composite and New York's S&P 500 indexes posted modest gains of
4.2% and 1.9%, respectively.
The latest performance results are the first since a change in
leadership for the Canadian pension fund giant. Mark Machin,
formerly head of CPPIB's international operations, took over as
chief executive June 13. He succeeded Mark Wiseman, who is set to
join BlackRock Inc. in September as head of global active equity
for the world's largest money manager.
CPPIB says its investment strategy is focused on diversifying
its holdings across geographies and public and private asset
classes to help guard against volatility in a bid to outperform
over the long term during down markets and keep pace during bull
runs.
"That power of diversification came through," in the latest
performance, Mr. Machin said in phone interview. Since assuming his
new role, Mr. Machin has promoted a number of CPPIB executives to
more senior roles but reiterated on Thursday that "we don't expect
any great lurches in the strategy."
Write to Ben Dummett at ben.dummett@wsj.com
(END) Dow Jones Newswires
August 11, 2016 13:05 ET (17:05 GMT)
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