Pension Fund Investment Portfolios Thrive During Pandemic

Many of the world’s largest institutional investors report over 20% gains despite the economic impact of COVID-19.


Despite the economic difficulties caused by COVID-19, the world’s largest institutional investors have thrived during the pandemic, as numerous pension funds have reported returns of more than 20% for the most recent fiscal year.

The strong gains helped the 300 largest pension funds in the world grow their assets under management (AUM) by 11.5% to reach a collective $21.7 trillion in 2020, according to research from the Thinking Ahead Institute.

The world’s largest pension fund, Japan’s $1.68 trillion Government Pension Investment Fund (GPIF), reported a record 25% return on its investments for the fiscal year ended March 31.

Australia’s sovereign wealth fund, known as the Future Fund, reported a record 22.2% return for the fiscal year ended June 30 to reach A$196.8 billion ($144.3 billion) in assets, while its antipodean neighbor, the New Zealand Super Fund, posted its strongest ever annual return of 29.63%, raising its asset value to NZ$59.8 billion ($42.5 billion), an increase of NZ$15 billion over 12 months.

Want the latest institutional investment industry
news and insights? Sign up for CIO newsletters.

In Europe, Swedish pension fund AP1, which benefited from one of the strongest domestic stock markets in the world, reported an 11% investment return for the first half of 2021 to raise its total AUM to just over $50 billion, while Denmark’s ATP earned a 17.9% return for the first half of calendar 2021, raising its total asset value to $146 billion.

And in the US, major public pension funds in California, New York, Pennsylvania, Massachusetts, Maryland, and Kentucky reported double-digit investment returns during the past fiscal year.

California giants the $308.6 billion California State Teachers’ Retirement System (CalSTRS) and the $469 billion California Public Employees’ Retirement System (CalPERS) reported returns of 27.2% and 21.3%, respectively. That return was the highest ever for the CalSTRS.  

The $254.8 billion New York State Common Retirement Fund reported a record 33.55% investment return for the fiscal year ending March 31; the $95.7 billion Massachusetts Pension Reserves Investment Management Board (MassPRIM) reported a 29.5% return, the highest in the pension fund’s 35-year history; and the $22.7 billion Kentucky Public Pension Authority (KPPA) returned a best-ever 25% net of fees for the fiscal year ended June 30, raising its total asset value to $22.7 billion.

Meanwhile, the Florida Retirement System returned 29.46% to push its total asset value to $250.5 million, and the Public Employees’ Retirement System of Mississippi returned 32.71% to grow to $35.6 billion.

The $94.8 billion Ohio State Teachers Retirement System (STRS), which was recently accused in an audit report of squandering billions of dollars, reported returns of more than 29% for the fiscal year ended June 30. And despite being under an FBI investigation over alleged kickbacks and bribery, the $65.9 billion Pennsylvania Public School Employees’ Retirement System (PSERS) reported a 25% investment return for the fiscal year ended June 30, its highest return in two decades.

Related Stories:

Kentucky Pension Fund Reports Record 25% Return for Fiscal 2021

CalSTRS Earns Record Annual Return of 27.2%

Japan’s $1.7 Trillion Pension Giant Breaks Record, Returns 25% in 2020

Tags: , , , , , ,

«