Japan’s Government Pension Investment Fund, the world’s largest pension fund, posted a gain of 7.9 trillion yen ($69.5 billion) in the fiscal year ended on March 31 as global stock markets rallied. GPIF on Friday reported a return of 5.86 percent in the year, on assets worth 144.9 trillion yen. Japan’s benchmark Nikkei 225 gained 12.8 percent last fiscal year, helped by the Bank of Japan’s aggressive purchases of exchange-traded funds (ETF). Global stocks also benefitted from continuing loose monetary policy, with central banks around the world keeping rates close to all-time lows.
GPIF made a return of 14.89 percent on its Japanese stock holdings, and 14.2 percent on its foreign stock holdings. In 2014, GPIF made a major policy shift, increasing investments in riskier assets such as stocks for higher returns, while it reduced its reliance on low-yielding domestic bonds.
Japanese stock holdings accounted for 23.28 percent of GPIF’s assets, while domestic bonds made up 31.68 percent. The pension fund allocated 23.12 percent to foreign stocks and 13.03 percent to foreign bonds. The remaining 8.89 percent was held mainly in cash.
Its Japanese bond portfolio made a negative return of 0.85 percent, while foreign bond holdings returned a negative 3.22 percent as yields rose, pushing bond prices down. GPIF said it had owned shares in 2,207 companies through March, while its Japanese bonds were mostly in JGBs.