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Canada Pension Plan ekes out 0.56% return in fourth quarter

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Canada Pension Plan, Ottawa, fell below C$300 billion in assets in the fourth quarter to C$298.1 billion ($221.3 billion) as of Dec. 31 due to cash outflows, despite returning a net 0.56% for the quarter.

Cash outflows totaled C$4.1 billion, canceling out C$1.7 billion in net investment income, said a news release from the Canada Pension Plan Investment Board, which oversees the money management of the pension fund.

The news release said the fund generally receives more contributions than it needs to pay benefits during the first part of any given calendar year, which is then offset in the final months by payments exceeding contributions.

The plan returned 6.9% for the first nine months of its fiscal year ending March 31. For the five years ended Dec. 31, the pension fund's investments had an annualized return of 11.7% and for 10 years, 6.5%.

CPP slightly increased its public and private equities and infrastructure allocations during the fourth quarter and dropped its fixed-income and real estate allocations slightly.

As of Dec. 31, the actual allocation was 34.8% public equities, 22.1% fixed income, 21.2% private equity, 12.6% real estate and 9.3% infrastructure.

Its asset allocation as of Sept. 30 was 34.5% public equities, 24.2% fixed income, 21% private equity, 12.8% real estate and 7.5% infrastructure.