Alberta Investment Management Corp. (AIMCo) earned a gross return of 10.8% and a net after-cost return of 10.2% in 2012.
However, assets under management declined to $68.6 billion from $69.7 billion at the end of 2011 as the government made withdrawals from its sustainability fund.
In the annual report, AIMCo CEO Leo de Bever said the fund is looking for bond substitutes less sensitive to interest rate risk as bond markets may be reversing a long period of good returns.
“Stocks are not cheap, but return on stock risk will likely be higher than on bond risk over the next five to 10 years,” he wrote. “We are putting more assets in private investments. With good selection, we should earn higher net returns than we can get from listed assets.”
Read more: