The Caisse de dépôt et placement du Québec is reporting a return of 3.3 per cent on clients’ funds for the first six months of 2018, compared with 3.5 per cent for its benchmark portfolio.
Over five years, the weighted average annual return was 9.9 per cent, which represented net investment results of $111.3-billion.
That brought the pension fund manager’s net assets to $308.3-billion.
The Caisse earned a 9.3-per-cent return in 2017.
“The market environment became more complex in the first half of the year,” Caisse president and chief executive Michael Sabia said in a statement on Thursday.
“Tightening liquidity conditions and protectionist measures by the U.S. have increased volatility since January. The long-running global bull market is slowing down. As the U.S. Federal Reserve continues to normalize its monetary policy and rates gradually climb, we are seeing a change of tone in the markets.”
In the first half of 2018, the Caisse pursued its strategy of diversifying its sources of returns by investing in credit and less-liquid assets, concentrating on the new economy as well as on renewable energy and green technology.
The six-month period also saw the Caisse and development capital organization Fonds de solidarité FTQ sign an agreement with Boralex Inc. to invest up to $300-million by way of an unsecured subordinated loan in the renewable energy company.
The Caisse has invested $170-million under the agreement, which follows a stake of nearly 20 per cent taken in the company in 2017.
The $308.3-billion in clients’ net assets was $9.8-billion higher than the $298.5-billion as of Dec. 31, 2017. The growth was attributable to net investment results of $9.4-billion and net deposits of $400-million.