The Canada Pension Plan Investment Board (CPPIB) posted a 14.9% gain for fiscal 2009, adding $16.2 billion to the fund, its third-best gain in the past 10 years.
However, returns were 5.9% below market performance.
Debt instruments (excluding bonds) were the star asset class for the CPPIB, posting returns of 63%, followed by emerging markets equities (45.9%) and Canadian equities (43.7%).
Troubled asset classes include private real estate (-11.8%), developed markets private equity (-9.4%), infrastructure (-6.5%) and private emerging markets equities (-4.3%).
CPPIB president and CEO David Denison explained that the values for private assets could take time to reflect public market levels, particularly in volatile economic times.
“Private investment returns are expected to play out over the long term and cannot be captured within just a 12-month snapshot,” he said, in a statement. “For example, we believe there is considerable value embedded in our real estate and infrastructure investments that will be realized over time.”
In terms of private deals, 2009 was a very busy year for the CPPIB. It closed 37 private transactions—including real estate, infrastructure and private-equity deals to the tune of $7 billion. However, a lack of currency hedging hurt returns in these areas as the Canadian dollar surged against local currencies.
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