The Canada Pension Plan Investment Board reported a 3.6% net return for the second quarter of fiscal 2025 that ended September 30, lifting its total asset value to C$675.1 billion ($481.4 billion) from C$646.8 billion the previous quarter.
According to the pension giant, C$23.1 billion of the C$28.3 billion quarterly gain in net assets came from the portfolio’s investment returns, while the remaining C$5.2 billion came from net transfers from the Canada Pension Plan. The quarterly returns were buoyed by rising U.S. equities, while its fixed-income assets benefitted from interest rate cuts in developed markets.
CPPIB’s infrastructure and credit investments also contributed to the gains. However, the returns were offset by the appreciation of the Canadian dollar against the U.S. dollar, which had an overall negative impact on the portfolio, according to the pension fund.
CPPIB also reported a 10-year annualized net return of 9.1%, and a five-year annualized return of 8.0%. For the six months that ended September 30, the portfolio had a net return of 4.6%, which translated to a C$42.7 billion increase in value. The six-month gain was comprised of C$29.3 billion in investment income, plus C$13.3 billion in net transfers from the CPP.
“Despite heightened market volatility during the quarter, our diversified investment portfolio delivered stable returns, with positive performance across asset classes and geographies,” CPPIB President and CEO John Graham said in a statement. “The portfolio is performing as designed. Our focus remains on creating long-term value through market cycles in the best interests of CPP contributors and beneficiaries.”
The pension fund does not report its asset allocation on a quarterly basis; however, for the fiscal year that ended March 31, it reported 41% in public fixed income, 28% in public equity, 26% in real assets, 23% in private equity and 14% in credit. This was countered by a negative 32% allocation for cash and absolute return strategies, which often include shorting equities.
On a geographical basis, the pension fund’s asset allocation as of the end of September was 44% in the U.S., 20% in the Asia-Pacific region, 19% in Europe, 12% in Canada and 5% in Latin America.
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