National Pension Service, Jeonju, South Korea, posted a return of 13.6% for the year ended Dec. 31, bringing its total asset value to 1.036 quadrillion won ($800 billion), according to a statement Feb. 28.
The result is the pension fund's best performance since its launch. Stock and bond markets performed well domestically and overseas, which led to a strong performance and solid annual returns, the statement said.
The rise in the won-dollar exchange rate also contributed to positive returns, it said.
The pension fund's equity investments led its strong returns. Domestic equity, which had a 14.3% weight in the fund's portfolio, returned 22.1%; while international equity returned 23.9%. International equity made up 30.9% of the portfolio.
Domestic bonds, which made up 31.5% of the portfolio, gained 7.4%, while overseas bonds, which were 7.1% of total assets, had an 8.8% return.
The remainder of the portfolio was made up of alternative investments, which had a 5.8% return, and short-term funds, which gave the pension fund a 4.2% return.
The global investment environment was difficult last year because of geopolitical risks and volatility, but the pension fund managed the situation by diversifying the portfolio and strengthening management expertise, said Kim Tae-Hyun, chair of NPS, in the statement.
The pension fund will continue to strengthen the flexibility of its asset allocation and expand investment sources, he added.
