Korea Investment Corp. on Thursday reported a 15.4% rate of return on investments for 2019, lifting the value of its portfolio to $157.3 billion.
The latest investment gains were KIC's strongest since 2017, when the Seoul-based sovereign wealth fund reported a 16.6% return. It also marked a rebound from 2018, when a sell-off of global equities in the last quarter resulted in a negative return on investments of -3.7%.
The more than $20 billion gain in assets under management for the year was KIC's biggest, in dollar terms, since it began investing in 2006, a KIC spokesman said.
At the end of 2019, the fund had allocations of 40.8% for equities, 35.5% for fixed income, 15.6% for alternatives — comprised of real estate, infrastructure, private equity and hedge funds — and 8.1% in "other" investments, including inflation-linked bonds, commodities, cash and hybrids.
At the close of the 2018, KIC had fixed-income allocations of 36.7%, equity allocations of 35.3%, 16.4% in alternatives and 11.6% in other investments.
For the year, KIC reported a return of 27.5% on the fund's equity allocations, 7.5% on fixed income and 7.6% on its alternative holdings.
In a press conference Thursday, Heenam Choi, KIC's chairman and CEO, said KIC will look to capitalize on investment opportunities in the coming year by further diversifying its portfolio and actively managing the fund's asset allocation strategy.
Separately, Mr. Choi said Thursday that KIC will open an office in San Francisco during the third quarter of 2020 to better position the fund for investments in promising Silicon Valley startups.
It will be KIC's fourth overseas base after the fund opened offices in New York in 2010, London in late 2011 and Singapore in 2017.
In contrast to those previous offices established in international financial centers, the forthcoming office will signal a "new localization strategy tailored for alternative assets," Mr. Choi said.
The office will be responsible for boosting KIC's ties with pension funds, general partners and asset management companies in California, he said.
