As of June 30, 2023, the Caisse posted an average return of 4.2% over six months, similar to that of its benchmark portfolio, the institution announced on Wednesday morning.
By comparison, the Ontario Teachers’ Pension Fund (TEACHERS) returned 1.9% over the same period.
Net assets reached 424 billion, up from 402 billion as of December 31.
The CDPQ manages the funds of 48 depositors like the public pension plan for Quebec workers. Returns for the CDPQ’s eight largest depositors range between 3.8% and 5.2% over six months. Over five years, their annualized returns vary between 4.4% and 6.8%, and over ten years between 6.5% and 8.9%.
“Over the past three years, we have evolved our portfolio to deal with market volatility. In this context, we have generated returns that allow us to ensure the financial health of our depositors’ plans,” said Charles Emond, President and Chief Executive Officer of the CDPQ, in a press release.
Bond markets recovered in the first half after a negative return in 2022. Over six months, the CDPQ posted a return of 3.9%, higher than that of its benchmark index at 3.2%. The results were boosted by the credit activities: in the debt of emerging countries and corporate credit.
On the infrastructure side, the portfolio posted a return of 4.7% in an inflationary environment, higher than its index at -2.1%.
Real estate, for its part, declined. Over six months, the return is -1.5%, compared to -4.3% for its benchmark. The rise in interest rates affects the entire industry, underlines the institution.
The category of industrial buildings is doing better than offices, affected by telework. Its subsidiary Ivanhoé Cambridge benefits from this, which has made a shift towards the logistics sector in recent years.
In terms of equities on the stock markets, the portfolio posted a return of 10.6% in six months, in line with the market at 10.7%. The institution notes that “the performance of the portfolio thus reflects a comparable return, but more diversified than that of the markets”, which is concentrated in 7 titles such as Apple, Tesla, Microsoft, etc.
“Investors are faced with several conflicting signals, such as the direction of inflation, rates, employment or markets. This challenging environment invites us to remain vigilant,” said Charles Emond.