Japan's Government Pension Investment Fund on Friday reported an investment gain of 2.81% for GPIF's third fiscal quarter ended Dec. 31, lifting the value of its portfolio to just less than ¥200 trillion ($1.74 trillion).
The roughly one-quarter of GPIF's portfolio parked in overseas stocks delivered the bulk of those gains, with ¥5.1 trillion, or 93% of the quarterly total.
GPIF President Masataka Miyazono, in a statement posted on the fund's website, said expectations for economic recovery lifted overseas stocks, especially in the U.S. Domestic stocks, meanwhile, edged lower while the yen declined against the dollar and edged lower against the euro as well, he said.
A 10.54% return on the fund's foreign stock holdings, trailing the 10.92% advance for GPIF's MSCI ACWI benchmark, lifted the portfolio's value to ¥51.6 trillion as of Dec. 31, or 25.7% of the portfolio.
Domestic equities, meanwhile, slipped 1.6% to ¥50.1 trillion, or 24.92% of the portfolio.
For the prior quarter ended Sept. 30, it was domestic stocks that powered portfolio returns, with a 5.4% gain offsetting a 0.8% drop in the value of the fund's holdings of overseas stocks.
Helped by the yen's retreat against the dollar, GPIF's foreign bond holdings climbed 2.52% to ¥49.1 trillion, or 24.46% of the total.
Domestic bonds were little changed, edging down 0.02% to ¥50.1 trillion yen, or 24.95% of the portfolio.
As of Sept. 30, domestic bonds accounted for 26.8% of the portfolio, followed by 25% for domestic stocks, 24.2% in foreign bonds and 24% in foreign stocks.
GPIF's portfolio ended the latest quarter valued at ¥199.3 trillion, up from ¥194.1 trillion at the close of the prior quarter.
The fund's exposure to alternative asset classes stood at 0.92% of the portfolio as of Dec. 31, an incremental advance from 0.82% as of Sept. 30.