TOKYO (Reuters) – The Government of Japan’s Investment Fund (GPIF) on Friday declared a record return on investment of 37.8 trillion yen ($ 338.8 billion) for the fiscal year ended March 31, benefiting from benefits of a strong recovery in global stock markets.
GPIF relies heavily on a passive index tracking strategy, so its returns generally reflect market movements. Japan’s Nikkei stock index rose 55% in the last fiscal year while the Dow Jones Industrial Average rose more than 50%, as market sentiment increased alongside progress in the programs. vaccination against the pandemic in the world.
The world’s largest pension fund, which managed 186.2 trillion yen in assets at the end of March, said in a statement that it had an annual return of 14.7 trillion yen on domestic stocks and of 20.7 trillion yen on foreign stocks.
He said the return from January to March was 10,000 billion yen.
GPIF investments are closely watched by global investors due to the size of the fund. GPIF recently shifted its portfolio from unprofitable domestic bonds to higher yielding foreign assets, given ultra-low interest rates in the country.
Foreign bond holdings represented 24.61% of GPIF’s assets under management in January-March, against a record 25.71% in the previous quarter.
Holdings of Japanese bonds stood at 25.92%, from a record low of 23.64% in October-December.
To diversify its portfolio, GPIF has placed more emphasis on environmental, social and governance (ESG) investments as global investors turn to this growing market segment.
The fund invested around 10.6 trillion yen in domestic and foreign stocks linked to ESG at the end of March, up from 5.7 trillion yen a year earlier.
($ 1 = 111,5700 yen)
Reporting by Takashi Umekawa; Editing by Sherry Jacob-Phillips and Christopher Cushing
