(Pictured: Takahiro Mitani)
by Penny Pryor
The Japan Government Pension Investment Fund (GPIF), the largest pension fund in the world at 137 trillion yen as at December 2014 ($1.4 trillion) has begun the process of investing more in equities and international bonds, away from Japanese Government Bonds, with the appointment of transition managers earlier this month.
Nomura Asset Management and BlackRock Japan (subcontractor BlackRock Asset Management North Asia) have been appointed for domestic equities, and BlackRock has also been appointed for international bonds. Russell Investments Japan (subcontractor Russell Implementation Services) has been appointed for international equities.
Backup managers, which the fund would not name, have also been appointed.
Last October the fund announced a radical reform of its asset allocation, with doublings of its allocations to both international and domestic equities (see below).
Alternative assets will also be included as part of the mix.
“Alternative investment will be made within maximum 5% of total portfolio, in accordance with development of dedicated team,” the fund said.
“Infrastructure, private equities, real estates or other assets determined upon deliberation at the Investment Advisory Committee, are classified as domestic bonds, domestic stocks, international bonds or international stocks, depending on their risk and return profiles.”
The changes should open up big opportunities for international and Australian managers looking to get a piece of the GPIF pie.
Penny Pryor is editorial director of Switzer Daily and the Switzer Super Report.