The CPP fund ended 2015 with net assets of $282.6 billion, compared to $272.9 billion at the end of the previous quarter, according to the latest results from the Canada Pension Plan Investment Board (CPPIB).
The $9.7-billion increase in assets for the quarter consisted of $12.3 billion in net investment income after all CPPIB costs, less $2.6 billion in CPP cash outflows. The portfolio delivered a gross investment return of 4.6% for the quarter, or 4.5% net of all costs.
For the nine month fiscal year-to-date period, the CPP Fund increased by $18 billion from $264.6 billion at March 31, 2015. This included $16.3 billion in net investment income after all CPPIB costs and $1.7 billion in net CPP contributions. The portfolio delivered a gross investment return of 6.3% for this period, or 6.1% net of all costs.
“Income generated across our investment programs and the advance of global equities contributed to the Fund’s growth during the quarter, while fixed income results were mixed,” said Mark Wiseman, president and CEO of the CPPIB. “Our globally diversified portfolio allowed us to earn significant gains from foreign exchange, as the Canadian dollar depreciated against most foreign currencies.
“The design of our highly diversified portfolio continues to deliver growth during positive market conditions, while preserving value by moderating the effect of difficult markets on the downside. The five- and 10-year returns remain strong and demonstrate the prudence of our long-term investment approach.”
According to a statement, CPPIB is building a portfolio and investing in assets designed to generate and maximize long-term, risk-adjusted returns. Accordingly, long-term investment returns are a more appropriate measure of CPPIB’s performance than returns in any given quarter or single fiscal year.