TOKYO (Reuters) – Japan’s Government Pension Investment Fund, the world’s largest pension fund, lost 5.5 trillion yen ($49.7 billion) on its investments in the first quarter as worries about U.S.-China trade friction pushed down stocks in Japan and abroad, the fund said on Friday.
It was GPIF’s fourth quarterly loss since it began shifting more of its assets into stocks while slashing bond allocations in October 2014.
GPIF said foreign equities were its worst performers in January-March with a negative return of 6.35 percent. Domestic equities suffered a negative return of 4.72 percent.
Japan’s Nikkei 225 and the Dow Jones Industrial Average fell 8.7 percent and 2.9 percent, respectively, during the quarter after U.S. President Donald Trump in March signed a memorandum targeting up to $60 billion Chinese goods with tariffs.
The yen’s 5.6 percent rise against the dollar during the quarter also eroded the value of GPIF’s overseas assets.
GPIF had 156 trillion yen worth of assets under management as of end-March.
It allocated 25.14 percent to Japanese stocks, 27.5 percent to domestic bonds, 23.88 percent to foreign stocks and 14.77 percent to foreign bonds during the quarter. The remaining 8.7 percent was in short-term assets, mainly cash.
According to a Reuters calculation based on the fund’s results, it bought a net 1.8 trillion yen of foreign bonds, 230 billion yen of foreign stocks and 70 billion yen of domestic equities, while reducing 880 billion yen of JGBs.
Reporting by Takashi Umekawa; Editing by Chris Gallagher