World's largest pension fund drops $4.5B in third quarter

World's largest pension fund drops $4.5B in third quarter
GPIF posted the huge loss due to decline for domestic bonds.
NOV 02, 2023

Japan’s state pension fund, the world’s largest, posted a loss of ¥683.2 billion ($4.5 billion) on total assets during the three months through September as its holdings of domestic debt slumped by a record.

The Government Pension Investment Fund lost 0.3% during the quarter, the fund said in Tokyo Thursday. Total assets rose slightly to ¥219.32 trillion due to a transfer of funds from the government’s account that manages its pension, according to a spokesperson. Domestic bonds lost 2.7%, the most since the fund’s predecessor started investing in 2001. Japanese stocks returned 2.5%. 

Strength in the dollar against the yen supported overseas assets. The GPIF’s holdings of shares abroad lost 0.1%, while its non-Japanese bonds lost 0.8% as the dollar gained more than 3% against the yen during the period.

With about one-fourth of the fund’s assets consisting of domestic bonds, the latest loss illustrates the growing risk of holding the securities as the Bank of Japan slowly moves away from its ultra-loose monetary policy. Yields on benchmark 10-year bonds hit a fresh decade high this week after the central bank adjusted its stimulus to allow long-term yields to edge higher.

“We will make investments from a long-term perspective and fulfill our fiduciary duty to leave funds to support our pension system,” Masataka Miyazono, president of the fund, said in a statement.

Latest News

Advisor moves: RBC lands $1B UBS team in Pittsburgh
Advisor moves: RBC lands $1B UBS team in Pittsburgh

Elsewhere, Wells Fargo Advisors adds a $400 million Morgan Stanley veteran in Naples as an ex-Cetera advisor goes independent with LPL

GWG’s Heppner hires Puff Daddy’s attorneys as criminal sentencing looms
GWG’s Heppner hires Puff Daddy’s attorneys as criminal sentencing looms

According to a federal charges Bradley Heppner, 60, received more than $150 million in payments through funneling money from GWG Holdings to a shell company.

Investors accuse Broadstreet fund of alleged billion-dollar 'Ponzi-like' scheme
Investors accuse Broadstreet fund of alleged billion-dollar 'Ponzi-like' scheme

A $1B fund allegedly skimmed 30% off the top, then swapped cash for locked-up stock.

Lawsuit alleges Skechers founders manipulated $9.4B buyout to shortchange investors
Lawsuit alleges Skechers founders manipulated $9.4B buyout to shortchange investors

Insiders allegedly rewrote projections three times in four days.

Fintech bytes: FINNY signs Visionary Square for pay-as-you-go AI prospecting program
Fintech bytes: FINNY signs Visionary Square for pay-as-you-go AI prospecting program

TCI Wealth Advisors also has also tapped JIFFYAI to unify onboarding and servicing, while TradePMR adds ICE market data to its Fusion advisor platform

SPONSORED Built on insurance experience to deliver on long-term promises

Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.

SPONSORED In the Age of AI, Trust Becomes the Advisor's Greatest Asset

As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor