The Caisse de dépôt reports a loss of $33.6 billion for the first six months of 2022

On June 30, the Caisse posted a negative return of -7.9% for the first six months of 2022, or a loss of $33.6 billion. Although the institution outperformed its benchmark index, which fell -10.5%, this result contrasts with the exceptional return of 13.5% recorded for all of 2021.

Taking into account deposits, the Caisse’s net worth fell $28.2 billion from $420 billion to $392 billion.

The President and Chief Executive Officer of the Caisse de depot et Placement du Québec, Charles Émond, nonetheless expressed reassurance about the state of the Caisse’s finances.

Photo: Radio Canada / Ivanoh Demers

However, the President and CEO of the Caisse, Charles Émond, wanted to reassure Quebec savers by presenting these results on Wednesday and stressing that the plans’ funding is solid. : leur pension n’est pas à risque. Les régimes sont pleinement capitalisés, même après ces baisses-là. Et depuis deuxans qu’il y a ces conditions atypiques avec une pandémie, une guerre, des hausses de taux, l’inflation […] on a haussé nos actifs depuis deux ans de 60milliards de dollars. Donc, il n’y a pas de crise actuellement pour que les gens soient inquiets.”,”text”:”Je prends toujours du recul comme PDG de la Caisse pour rassurer les gens: leur pension n’est pas à risque. Les régimes sont pleinement capitalisés, même après ces baisses-là. Et depuis deuxans qu’il y a ces conditions atypiques avec une pandémie, une guerre, des hausses de taux, l’inflation […] on a haussé nos actifs depuis deux ans de 60milliards de dollars. Donc, il n’y a pas de crise actuellement pour que les gens soient inquiets.”}}”>As CEO of the Caisse, I always take a step back to reassure people: your pension is not at risk. The plans are fully funded even after these cuts. And for the past two years there have been these atypical conditions with a pandemic, war, interest rate hikes, inflation […] We’ve increased our wealth by $60 billion over the past two years. So there is no crisis right now that people need to worry about.

In addition, the strong market recovery since June 30 has already offset half of this loss.

Do you want to talk about volatility? Half of the fall in value we saw in six months has been recouped in just over a month. »

A quote from Charles Émond, President and Chief Executive Officer of the Caisse de Depot et Placement du Quebec

If this trend continues, the fund could significantly improve its results. July also proved to be the best month for the markets in two years.

Negative yield of -7.9% and delisting of investments in cryptocurrency exchange Celsius Networks. Interview with Charles Émond, CEO of the Caisse de dépôt et Placement du Québec.

An atypical context

But like all investors, the Caisse could not escape an atypical context characterized by the unexpected and instability with the pandemic, the war in Ukraine, the surge in inflation and the sudden increase in interest rates. The worst, however, was the parallel collapse of stocks and bonds.

This is the worst semester for the stock and bond markets in 50 years. It’s a correction that’s extremely rare because it happens simultaneously. There were very few places to invest in without suffering a downside. »

A quote from Charles Émond, President and Chief Executive Officer of the Caisse de Depot et Placement du Quebec

The institution is also careful to note that not only is its result higher than its benchmark index, but the return over the 5- and 10-year periods is still 6.1% and 8%, respectively.

dernières années, on serait à 364milliards de dollars d’actifs, alors que notre actif aujourd’hui, que l’on rapporte, est à 392milliards de dollars [il était même remonté à 405milliards de dollars en date de mercredi, selon M. Émond]. On continue depuis deuxans d’être dans une série de conditions extrêmes, mais la Caisse a réussi à bien performer pendant ces deux années.”,”text”:”Si on avait fait comme notre portefeuille de référence les deuxdernières années, on serait à 364milliards de dollars d’actifs, alors que notre actif aujourd’hui, que l’on rapporte, est à 392milliards de dollars [il était même remonté à 405milliards de dollars en date de mercredi, selon M. Émond]. On continue depuis deuxans d’être dans une série de conditions extrêmes, mais la Caisse a réussi à bien performer pendant ces deux années.”}}”>If we had been our benchmark portfolio over the past two years, we would have been worth $364 billion, while our wealth today that we report is $392 billion. [il était même remonté à 405 milliards de dollars en date de mercredi, selon M. Émond]. We have continued to be in a number of extreme conditions over the past two years but the Caisse has managed to perform well over those two years.

The news is not gloomy across all sectors: on the real assets side, real estate and infrastructure portfolios are reporting positive returns of 10.2% and 5.8%, respectively. However, it should be noted that the real estate portfolio is one of the few to have underperformed the benchmark portfolio, which is 11.4%.

On the action side, the shoe pinches. As a result, the return on the private equity portfolio fell by 2.4%. But above all the stock portfolio collapsed in the first six months of 2022 with a minus of 16%.

As July’s rally cannot be taken as a harbinger of things to come, Charles Émond assures us that the Caisse remains vigilant. We will see how the prices will develop. Central banks’ stance on regaining control of inflation will be crucial. We are on a very fragile geopolitical chessboard with significant implications for investors. In addition, there are fears of an economic slowdown, and in some places even a recession.he remarked, making it clear that any attempt at prediction in such an unstable context would be futile.

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