The first six months of the year are colored red for the Caisse de dépôt et Placement du Québec (CDPQ), which delivered a negative return of 7.9%. Small consolation: the performance of the Quebecers’ wool socks is superior to the benchmark indices, where the declines are more pronounced.
Posted at 11:00 am
During a semester in which there was a “combination of factors not seen in several decades,” the manager of public and parastatal pension and insurance plans saw his net worth melt from $28.2 billion to $392 billion as of June 30. Without taking into account the net deposits of 35.4 billion, the decline would have been 33.6 billion.
“The first six months of the year have been very challenging,” the institution’s President and CEO, Charles Émond, said at a news conference on Wednesday. A rare simultaneous correction in the stock and bond markets, fears of an economic slowdown and the war in Ukraine and its many side effects. »
The benchmark for the Caisse’s overall performance over the six-month period was -10.5%. In addition, the results of the CDPQ for the first six months of the year do not take into account the stock market rally that has been observed in the markets for just over a month.
We had to work in extreme conditions for two years. If we had taken the photo today (at our performance), the portrait would be different. We would have 15 billion more in our fortune.
Charles Émond, President and CEO of the institution
In the equities sector, which includes equity markets and private investments, the return was -10.6% compared to the benchmark index of -11.9%. The slump in the markets resulted in a 16% drop on the equity market side, while the drop on the private equity side was less pronounced (-2.4%).
The monetary tightening mandated by central banks in hopes of a slowdown in inflation was reflected in the fixed income segment, where we find bonds. Performance was negative by 13.1% compared to a benchmark of -15.1%. Rising interest rates cause bond prices to fall.
Real assets – real estate and infrastructure – fared significantly better with a six-month performance of 7.9%, beating the benchmark index of 2.4%, which CDPQ says is a sign that they are “playing their part well.
- Number of CDPQ depositors. These include the Quebec Pension Plan and the Government Employees Plan (RREGOP).