TOKYO : Japan's Government Pension Investment Fund (GPIF) said on Friday it posted a first-quarter investment return of 4.98 trillion yen (US$45.3 billion) due to gains from foreign stocks, after a record annual return in the last financial year ended March 31.
GPIF, the world's largest pension fund, managed 191.6 trillion yen of assets as of end-June and its return on overall assets was 2.68per cent over the three-month period, it said in a statement.
GPIF relies heavily on a passive index-tracking strategy, so its returns usually mirror market movements. While Japan's Nikkei stock average fell 1.3per cent during the quarter, the Dow Jones Industrial Average was up 4.6per cent.
Its Japanese stock portfolio achieved a 0.25per cent loss and the foreign stock portfolio earned an 8.62per cent return.
GPIF's investments are closely watched by global investors because of the fund's sheer size. The pension fund has been shifting its portfolio away from unprofitable domestic bonds toward higher-yielding foreign assets, given ultra-low interest rates at home.
As of end-June, the fund had 25.39per cent of its portfolio in Japanese bonds, 24.72per cent in foreign bonds, 24.49per cent in domestic equities and 25.41per cent in foreign equities.
In the last financial year, GPIF posted a record investment return of 37.8 trillion yen, as market sentiment rose in tandem with progress made in vaccination programmes worldwide aimed at controlling the pandemic.
(US$1 = 109.8300 yen)
(Reporting by Takashi Umekawa; Editing by Muralikumar Anantharaman)