Japan’s public pension fund will increase its allocation to both domestic and foreign equities as well as begin to invest in alternatives.
The Government Pension Investment Fund (GPIF), which manages ¥127.3 trillion ($1.26 trillion) in assets, will allocate 25% to Japanese equities and 25% to foreign stocks, up from 12% each.
The fund will cut its exposure to domestic bonds to 35% of assets from 60% and increase its allocation to foreign bonds to 15% from 11%.
The GPIF will also invest a maximum of 5% of its portfolio in alternative investments.
It says that infrastructure, private equities, real estate or other assets will be classified as domestic bonds, domestic stocks, international bonds or international stocks, depending on their risk/return profiles.
Here’s a look at the new allocation:
| Allocation | New | Current |
| Japanese bonds | 35% | 60% |
| Japanese equities | 25% | 12% |
| Foreign equities | 25% | 12% |
| Foreign bonds | 15% | 11% |
| Short-term assets | – | 5% |
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