Japan’s GPIF posts 1.77% first quarter return

03 September 2014   Category: News, Asia, Global, Japan   By Maya Ando

Japan’s Government Pension Investment Fund (GPIF) achieved a 1.77% return on investment for the first quarter of fiscal year 2014.

According to the GPIF’s report for the three-month period ended June 30, the modest rise compared to the prior quarter, when it lost 0.80%, could be attributed to better performance in both local and global equities.

Within the period, it generated 2.22 trillion yen (US$21.31 billion) in investment income, with total AUM ballooning to 127.2 trillion yen. 

For the first quarter, the return from domestic equities was 5.1%, foreign equity at 3%, while domestic bonds and foreign bonds made 0.72% and 0.55%, respectively.

The GPIF has been lowering its exposure to Japanese bonds, which generate nearly zero interest, and their size in the portfolio was the smallest since comparable figures became available in 2008. The ratios for local and foreign equities, as well as overseas bonds, were at their highest.

Since the GPIF started to manage pension reserves itself in 2001, the fund has made 37.6 trillion yen in total profit. Due to the 2008 global financial crises, the pension fund lost 93 billion yen in profit, which it has now regained having been on a positive trajectory since 2012 amid an improving local equity market.