The Alaska Permanent Fund beat a passive index benchmark but missed its return target in its most recent fiscal year.
The Juneau, Alaska-based sovereign wealth fund gained 2% in the fiscal year ending June 30, the fund said Monday. It beat a passive index of 60-20-20 stocks, bonds, and real estate and Treasury inflation-protected securities (TIPS). But it failed to meet its return target of 5.65% for the year.
In fiscal year 2020, the Permanent Fund was worth an unaudited $64.7 billion, versus the audited $66.3 billion in fund value the previous year, according to last year’s annual report. In fiscal year 2019, the fund returned 6.3% in investment gains.
“We are pleased to see our returns end in positive territory,” Alaska Permanent Fund Corporation (APFC) CEO Angela Rodell said in a statement. “I think it highlights just how important it is to maintain discipline in volatile times. We held on to our core convictions and never lost sight of our long-term mandate.”
In March, the Permanent Fund was well-positioned to take advantage of market volatility. At the time, CIO Marcus Frampton said the portfolio benefited from an overweight position in cash and fixed income, resulting in “very strong relative performance and enviable levels of dry powder to deploy into investment opportunities.” About $2 billion was deployed during the crisis to equity markets.
Among the best performing asset classes were fixed income plus, which gained 4.2%, and private equity and special opportunities, which returned 2%. Absolute return gained 1.5% over the same time period.
Meanwhile, real estate lost .2% as an asset class, and infrastructure and private income opportunities lost .4%.
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Tags: Alaska Permanent Fund, Alaska Permanent Fund Corporation, Asset Allocation, Sovereign Wealth Fund