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Taiwan’s BLF funds’ investments in local stocks lift 2021 return

BLF
By Hui Ching-hoo   
February 9, 2022

Taiwan pension funds supervised by the Bureau of Labor Funds (BLF) posted an average investment return of 9.67% last year, up from 7.46% in 2020, as their investments in local stocks beat the market benchmark.

The eight pension and annuity funds’ total investment gain improved to NT$491.5 billion (US$17.66 billion) from NT$348.3 billion in 2020, and their assets rose to NT$5.1 trillion from NT$4.98 trillion.

“The investment gains were primarily attributed to the significant return of [their] domestic stock portfolio,” BLF says in a statement on February 7.

One-fifth of the funds’ assets are invested in Taiwanese stocks. These investments had a return of 30.6% versus the benchmark stock index which returned 23.66%.

According to the BLF, the funds managed to deliver “stable” long-term performance for members, with an annualised five-year investment return of 7.09% and a ten-year return of 5.85%.

“As global financial market volatility was spurred by geopolitical tension and pandemic crisis in recent years, BLF will continue to dynamically adjust its globally diversified portfolio to bolster risk-adjusted return and explore new opportunities,” it says.

The Labor Retirement Fund, Taiwan’s largest defined-benefit retirement plan, was the best performer among the funds, with an investment return of 11.22%, up from 8.5% in 2020.

The National Pension Insurance Fund had the second-best return of 9.88% versus 8.76% in 2020.