Japan’s Government Pension Investment Fund (GPIF) swung into the red in the second quarter of its current financial year with a 683.2 billion yen (US$4.56 billion) investment loss, dragged down by all of its investments except for domestic stocks.
Its investment return for the three months to September was minus 0.3%, the world’s largest pension fund says in a statement on November 3.
The performance was in sharp contrast to its first financial quarter to June, when the fund reported an 18.98 trillion yen investment gain and a return of 9.49%.
The GPIF didn’t provide reasons for the decline. But the pension fund has benefitted from Japan’s resilient domestic stock market, with the benchmark Nikkei 225 Index surging almost 24% in the first nine months of the year, thanks to improved corporate earnings and governance.
The GPIF’s investment in domestic equities was the only bright spot in its second quarter results, with a 1.33 trillion yen investment income in the three months to September.
Meanwhile, its domestic bond investments lost 1.52 trillion yen, while its investments in foreign bonds and foreign equities lost 403.7 billion yen and 91.1 billion yen, respectively.
The GPIF had 219.32 trillion yen of assets under management as of September 2023, up 14.17% from 192.09 trillion yen a year ago.
Its cumulative investment income since inception in 2001 was 126.68 trillion yen, equivalent to an average annualised return of 3.91%.
