11 trillion!The largest pension fund in the world has achieved the longest consecutive profit

2022-04-23 0 By

The world’s largest pension fund continues to grow after the epidemic, the scale of the rising tide lifting all boats.The Japanese Government Pension Investment Fund (GPIF) recorded a 2.81% increase in assets in the fourth quarter of 2021, with total assets under management reaching 199 trillion yen, or about 10.98 trillion yuan, according to its latest financial results.By comparison, the GPIF fund had 186 trillion yuan (10.25 trillion yuan) in assets in fiscal year 2020.The world’s largest pension fund earned 5.65%, 2.68%, 0.98% and 2.81% respectively from the first quarter to the fourth quarter of 2021.Since the second quarter of 2020, it has achieved seven consecutive quarters of net growth, the longest consecutive profitable period since it was marketized in 2001.The GPIF has a fairly balanced allocation of assets, with 50 per cent equity and 50 per cent bond investment in Japan and 50 per cent equity and 50 per cent bond investment in Japan.From the second quarter of 2020, GPIF’s investment income jumped, mainly from equity investment income.In fiscal year 2020, equity investment income reached 35.37 trillion yen, and equity investment income for the last three quarters, combined, narrowed to 10.37 trillion yen.Returns across asset classes for the three quarters of 2021 have been flat for both domestic bonds and equities.Equity was negative in the first and third quarters, with only the second quarter showing a decent 5.35% return, which pales in comparison to the 41.55% return in fiscal 2020.This is closely tied to the performance of Japan’s domestic stock market in 2021.After rising 16% in 2020, the Nikkei 225 entered a correction in 2021, with gains shrinking to 4.91%.In the latest quarter, GPIF’s foreign equity investments outperformed those in Japan, returning 8.62%, -0.77% and 10.54% in the first to third quarters, respectively, compared with 59.42% in fiscal 2020.Globally, all major SOVEREIGN wealth funds and pension funds have achieved good returns since 2020. For example, Norway’s SOVEREIGN wealth fund achieved a return of 11% and 15% in 2020 and 2021 respectively.There are already concerns about the sustainability of these high returns.Nikola Tangen, chief executive of Norway’s sovereign wealth fund, recently pointed to high global demand, continued disruptions to supply chains and the possibility that inflation could be more severe than widely expected.A number of factors, including wage increases for workers, reinforce the likelihood that inflation could become a permanent feature of the global economy and investors could face years of low returns.From the perspective of the economic cycle, monetary easing in 2020 has brought the general rise of the global market, but the powerful medicine cannot last. Although the Bank of Japan is still on hold, the most wonderful moment of equity assets has begun to end as the Federal Reserve starts to raise interest rates and shrink the balance sheet.Global bonds and equities are underperforming at the start of 2022, and investors’ long-term expectations for mainstream capital markets are darkening.AQR, the quant fund, estimates that a traditional balanced portfolio of 60 per cent stocks and 40 per cent bonds will return just 2 per cent a year, after inflation, over the next five to 10 years.That is less than half the average of about 5 per cent over the past century.However, economists are divided on whether the surge in inflation will be short-lived.Some believe the coronavirus pandemic has caused a temporary shock to supply chains that will ease as the economy recovers quickly.Blast!Just now, it went up 770 points!Hong Kong stocks off to a good start in the year of the Tiger!New energy vehicles, technology and other soaring!Ice pier pier thoroughly fire, hot search first!