OPTrust achieves 5.5% investment return in 2011Posted: April 18, 2012
TORONTO, April 18, 2012 - The OPSEU Pension Trust (OPTrust) today reported gross investment results of 5.5% for 2011, outperforming its 3.9% performance benchmark for the year. Total investment earnings were $578 million, down from $1.53 billion in 2010. Over the year, the Plan’s net assets increased to $13.7 billion at year-end ($13.3 billion as at December 31, 2010) after paying over $664 million in pension benefits in 2011.
“Our asset allocation strategies helped us navigate turbulent markets and mitigate risk for our members in 2011,” said Stephen Griggs, President and CEO of OPTrust. “We remain focused on delivering investment results that meet or exceed our funding target return over the long term.”
In a year of ongoing volatility and challenging global equity markets, OPTrust’s portfolio diversification strategy was a significant driver of investment results. The Fund’s holdings in infrastructure, real estate, fixed income and private equity all achieved double-digit positive performance in 2011.
The infrastructure portfolio was the strongest performer in 2011, with a return of 29.6%, while fixed income (including real return bonds) returned 19.4%. Real estate and private equity delivered returns of 14.8% and 11.3% respectively. Energy commodities were also positive, with a return of 8.2%. The Fund’s public equity portfolios outperformed their benchmarks but were negative for the year with returns of -7.3% for Canadian equities and -9.1% for global equities.
The Plan’s 2011 investment return was below its nominal funding target return of 6.5% for the year. The funding target is the rate of return, net of investment fees, OPTrust is expected to earn over the long-term to fund plan members’ earned pension benefits. Since OPTrust’s inception in 1995, the Plan’s combined investment portfolio has realized an average gross annual return of 8.5%, exceeding both its average funding target and the average return for its composite benchmark for the same period.
More information about OPTrust's 2011 investment results and the Plan's funding status and outlook is available in our 2011 annual report.
With assets of $13.7 billion, the OPSEU Pension Trust (OPTrust) invests and manages one of Canada’s largest pension funds and administers the OPSEU Pension Plan, a defined benefit plan with almost 84,000 members and retirees. OPTrust was established to give plan members and the Government of Ontario an equal voice in the administration of the Plan and the investment of its assets, through joint trusteeship. OPTrust is governed by a 10-member Board of Trustees, five of whom are appointed by OPSEU and five by the Government of Ontario.
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