The world's largest pension fund lost about $186 billion in the three months to December 31, as equities performed poorly.
Japan's Government Pension Investment Fund (GPIF)'s total assets dipped to $1.9 trillion in the third quarter of FY18 (in Australia, Q2 of FY19) as compared to $2 trillion in the same quarter the year before.
The fund is heavily tilted towards stocks with about half its total assets spread in an even split across local Japanese and global equities. Domestic bonds were less at about 28% of the total assets, while foreign bonds made up about 17%, at December end.
Returns from all of these asset classes, expect for foreign bonds, were in the red for the three months ending December 31.
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The fund lost $96 billion on Japanese equities and $86 billion on foreign equities in the three months to December 31, as GPIF's total holdings in the two asset classes lost just under 18% and 16% respectively in investment returns.
Domestic bonds were the only asset class to register a positive return in GPIF's portfolio in the quarter, going up 1% while the fund lost 2.7% on its foreign bonds holdings.
"The GPIF manages the public pension fund in the long term and its investment results should be assessed in the same manner," it said in a quarterly update.
The Japanese government's financial year starts in April. After the third quarter performance, the GPIF had lost 4.3% from April to December in JFY 2018.