When the S&P 500 closed at a record high on February 19, Canada’s major pension plans, with more than a quarter of their investments in stocks, were in a comfortable position in spite of the looming coronavirus pandemic.
It’s not just public equity that can impact the health of pensions. They are also vulnerable to swings in other asset classes, such as fixed income, private equity, real estate and infrastructure, areas that have also taken a hit in the crisis. Mortgage applications in the U.S. dropped 29.4 per cent last week and capital from seed-stage funding has decreased about 22 per cent globally since January. Currency fluctuations are also a risk, particularly the Canadian-to-U.S.
CPPIB had $140.8 billion invested in public equity as of Dec. 31, 2019, or about 27 per cent of its portfolio. It declined to share how much it had in public equity after the market drop. “The Fund is not immune to occasional, severe drops in the value of stocks. Indeed, of course, the current situation is impacting the Fund,” said Michel Leduc, global head of communications.
Not all of the big 10 pension funds are so exposed to public equity. The Ontario Teachers’ Pension Plan’s public equity holdings comprised just 10 per cent of its assets, according to its most recent financial report. Asked for comment, Teachers’ said that its 2019 results will be reported next week.
The Alberta Investment Management Corporation’s public equity holdings made up $41.5 billion when it last reported for the year ended March 31, 2019—36 per cent of the pension’s total holdings. AIMCo said it would report more recent numbers in mid-April.
michael_house9 We’re from the government, we’re here to help...
so basically back to they were they were a couple years ago? really didn't earn all those bonuses?
Uh oh
Pitiful money managers