During January-March after global markets plunged during the novel corona virus pandemic ,Japan’s Government Pension Investment Fund (GPIF), the world’s largest pension fund, has reported a record quarterly loss of 17.71 trillion yen.
A statement said in comparison of 4.61% gain in the previous quarter, GPIF posted a negative return of 10.71% on its overall assets during the three months.
Global Financial Markets closely watched that,”The mammoth-size fund, which managed 150.6 trillion yen of assets by end-March”.
The new president Masataka Miyazono who took the helm in April as market uncertainty looms poses a potential challenge. The quarterly loss, the biggest since GPIF started managing its assets on the market in 2001.
Japan’s benchmark Nikkei average fell 18% during the quarter, while the Dow Jones Industrial Average dropped 24%.
GPIF’s portfolio is evenly split at 25% each across domestic and foreign stocks and domestic and foreign bonds.The GPIF in April raised its allocation target for foreign bonds to 25% from 15% and lowered domestic bonds allocation to 25% from 35%.
The fund had 23.87% of its portfolio in Japanese bonds as of end-March, compared with 36.15% in September 2016 when the Bank of Japan launched its policy of pinning 10-year government bond yields around 0%. Its foreign bond holdings accounted for 23.42% of its portfolio.
The fund allocated 22.87% to domestic stocks and 23.9% to foreign stocks.