Government Pension Investment Fund
(Jul. 3, 2020)

Overview of Fiscal 2019
Investment Results

Fiscal 2019

Since Fiscal 2001

−5.20%+2.58%(−¥8,283.1 billion)(+¥57,537.7 billion)[annual rate]

Rate of return[annual rate][annual returns](Returns)[cumulative returns]¥150,633.2 billion[as of the end of fiscal 2019]

Asset size

Returns are marked to market as of the end of fiscal 2019, and include unrealized gains and losses. GPIF manages pension reserve fund with long-term perspective. While short-term portfolio returns are influenced by the current market
trends, investment results should be monitored with long-term horizon.
Regarding investment of pension reserve, while market fluctuations may cause capital losses (realized and unrealizedlosses due to price fluctuations) in the short term, investment income (interest dividend income) is relatively immune
to such volatility and generates a continuous stream of positive return.
At the end of March 2020, over sixty percent of cumulative returns was investment income, which has increased
steadily since fiscal 2001.

Cumulative returns since fiscal 2001¥billion
70,00063,441.3

65,820.8

57,537.7

45,423.9

37,141.2

35,441.5

30,00025,220.9
20,751.8

20,00017,370.3
13,425.8

10,000537.8-587.4

1,189.6

2,021.1
1,851.1

4,463.8
3,127.0

4,474.9

11,852.5

10,315.7

6,115.5

12,509.4

14,602.6

11,689.3 11,389.4

33,900.6

23,005.0

25,547.4

28,080.830,859.7

16,636.7
18,610.7
13,998.6

8,116.4
2,504.3-3,040.5-10,000
FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

Investment income

40,000053,360.3

50,733.8

50,000Capital gains

60,000Investment Results in Fiscal 2019[1] Investment results
Rate of investment return
The rate of investment return for fiscal 2019 is-5.20%.

(Unit: %)1Q

Market Investments

Total
Domesticbonds
Domestic
equities
Foreignbonds
Foreignequities
Short-term
assetsFILP bonds

2Q

3Q

4Q

0.16

1.14

4.61

0.81

0.31

-2.31

3.34

Total%
12.0%
10.0
12.0
8.0
10.0
6.0
8.0
4.0
6.0
2.0
4.0
0.0
2.0-2.0
0.0
-4.0
-2.0
-6.0
-4.0
-8.0
-6.0
-10.0
-8.0
-12.0
-10.0
-12.0
%
15.0
%
15.0
10.0

Quarterly
Cumulative

5.91

Quarterly
Cumulative

0.16
0.16

1,29

5.91
4.61

1.14
1,29

4.61

-10.71
1Q

2Q

3Q-10.71
4Q

1Q

2Q

3Q

4Q

-10.71

-5.20

-0.96

-0.51

-0.36

8.58

-17.63

-9.71

10.0
5.0

3.55
3.55

0.94

1.21

0.86

0.50

3.55

5.0
0.0

1.29

0.11

9.73

-21.88-13.08

0.0
-5.0

-0.05

0.01

0.01

-0.01

-0.04

-5.0
-10.00.48

0.48

0.49

0.49

1.93

-10.0
-15.0

-5.20
-5.20

1.14

-0.36

-0.04

-0.36

-0.04
-9.71

1.93

-5.20
-5.20

-13.08-9.71 Foreign
Domestic Domestic
bonds equities bonds

-15.0

1.93

-13.08Foreign Short-term
equities

assets

FILP
bonds

Total

(Note 1)	Fiscal 2019 runs from April 1, 2019 to March 31, 2020.
Total
Domestic Domestic Foreign Foreign Short-term FILP
bonds
equities
bondsandequities
bonds
is markedto market)(Note 2)	GPIF’s portfolio consists of the funds invested in the markets (hereinafter “market investment”, whichFILP bondsassets(see Note5), which are held to maturity and valued at amortized costs.
(Note 3)	In this report, return figures are the average of returns of market investment and FILP bonds weighted with investment principal, and are gross of fees. The rate of return withineach asset class other than FILP bonds is time–weighted.
(Note 4)	Alternative asset funds contain a mixture of asset classes, and the investment returns of such funds are allocated to each asset on a pro-rata basis according to the targeted asset
composition ratio in the investment plan at the start of investment of such funds (the same shall apply hereinafter).
(Note 5)	FILP bonds are government bonds issued to finance the Fiscal Investment and Loan Program (FILP).

Amount of investment returns¥billion
20,000Quarterly
Cumulative

The amount of investment
returns for fiscal 2019 is9,424.1

10,000-¥8,283.1 billion.

02,062.7256.9

7,361.3

1,805.8-10,000-8,283.1-17,707.2

Market Investments(Unit: ¥billion)

1Q

2Q

3Q

Total

256.9

1,805.8

7,361.3 -17,707.2

Domesticbonds
Domestic
equities
Foreignbonds
Foreignequities
Short-term
assets339.3

131.8-408.7-184.5-122.1-892.6

1,261.6

3,348.0-7,418.5-3,701.5

268.6

361.4

270.1

115.3

1,015.4

541.3

46.1

4,147.0 -10,223.1-5,488.7

-3.9

0.6

0.7

-0.7

-3.4

4.3

4.3

4.3

4.3

17.2

FILP bonds

4Q

Total
-8,283.1-20,000

1Q

2Q

3Q

4Q

¥billion
10,0005,000

1,015.4
0-5,000-10,000

17.2-3.4-122.1-3,701.5

Domestic Domestic Foreign
bonds equities bonds-5,488.7
Foreign Short-term FILP
equities
assetsbonds(Note 1) Investment returns are gross of fees.
(Note 2) Due to rounding off, the sum of each item in individual quarters does not necessarily match the total number for the fiscal year.

-8,283.1
Total

Cumulative returns and asset size since fiscal 2001
Cumulative returns from fiscal 2001 to fiscal 2019 are+¥57,537.7 billion
and the value of investment assets at the end of fiscal 2019 is¥150,633.2 billion.

Cumulative return¥billion

70,000+65,820.8+63,441.3

60,000+53,360.3

50,000+45,423.9

40,000+35,441.5

30,000+25,220.9+17,370.3

20,000+13,425.8
10,0000-10,000+57,537.7+50,733.8+4,463.8+1,851.1-587.4+13,998.6+11,852.5 +11,689.3+11,389.4+2,504.3-3,040.5

FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019

Asset size

¥billion

180,000
160,000

Market investments

156,383.2159,215.4
150,633.2

FILP bonds

144,903.4
137,476.9134,747.5
126,577.1
119,886.8
122,842.5
117,628.6
116,317.0113,611.2120,465.3
114,527.8
102,871.4

140,000
120,000
100,000

87,227.8

80,00070,341.1

60,00050,214.3

40,000 38,601.4
20,0000

FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019(Note) The balance of FILP bonds increased from fiscal 2001 to fiscal 2007 due to increased underwriting, and decreased since fiscal 2008 due to redemption on maturity.

Investment assets and portfolio allocation(Reserve Funds managed by GPIF and the Pension Special Account)
Inside:policy asset mix (figures in parentheses
indicate deviation limits)
Outside: at the end of March 2020

Foreign equities

23.90%¥37,163.9 billion

Domestic bonds (Note 6)

25 %

35 %

( ± 8%)

15%±Foreign bonds(Note 6)(·Foreign bonds (No hedge)

4%)22.22%¥34,549.8 billion

23.87%¥37,125.9 billion( ± 10 % )Short-term assets(Note 5)

5.95%
¥9,255.2 billion

25 %( ± 9%)·Foreign bonds (JPY hedged)

Domestic equities

1.20%¥1,858.9 billion

22.87%¥35,563.0 billion
Market value (¥billion)

Allocation of Pension Reserve

Domestic bonds

37,125.9

23.87%

Market investments

36,229.7

23.30%(Book value)

896.2

0.58%

(Market value)(937.1)–35,563.0

22.87%No hedge

34,549.8

22.22%

JPY hedged

1,858.9

1.20%

Foreign equities

37,163.9

23.90%

Short-term assets

9,255.2

5.95%

Total

155,516.8

100.00%

FILP
bonds

Domestic equities
Foreign bonds(Note 1) The figures above are rounded off, so the sum of each item does not necessarily match the total number.
(Note 2) The amounts in the Market value column include accrued income and accrued expenses.
(Note 3) The book value of FILP bonds is stated at amortized cost plus accrued income.
(Note 4)	While the pension reserve as a whole includes reserves managed under a special account as of the end of fiscal 2019 (about ¥4.9 trillion), this amount is prior to the adjustment
for revenues and expenditures and differs from the amount in the final settlement of accounts.
(Note 5)	At the end of March 2020, Policy Asset Mix is as follows: Domestic bonds 35% (±10%), Domestic equities 25% (±9%), Foreign bonds 15% (±4%), Foreign equities 25% (±8%).
Based on the current market trends, deviation limits for domestic bonds are flexibly managed as an interim measure. Specifically, short-term assets can be added to domestic
bonds within the range allocated for domestic bonds.
(Note 6)	JPY hedged foreign bonds are considered as alternatives to Domestic bonds in current market trends, and they are similar in terms of risk and return characteristics. Accordingly,
JPY hedged foreign bonds are excluded from Foreign bonds and included in Domestic bonds in terms of allocation at the end of March 2020. In other cases, such as the rate ofinvestment return for each asset class, JPY hedged foreign bonds are classified as Foreign bonds.
(Note 7)	Although the allocation of Foreign bonds exceeded the deviation limit at the end of March 2020, during the period when the policy asset mix was in transition, GPIF has managed
it properly according to the decision of the Board of Governors.
(Note 8)	The percentage of the alternative investments: 0.61% (within maximum 5% of total portfolio)

Allocation changes for each asset class due to rebalancing(Unit: ¥billion)

Domestic bonds Domestic equities
Allocated/withdrawn-5,931.9+609.5

Foreign bonds

Foreign equities+7,579.7+757.0(Note) Each figure shows the net rebalancing amount.