Look at stocks with the lowest volatility during challenging times: Portfolio manager
OMERS says it generated a net investment return of negative 0.4 per cent, or a loss of about $500 million, for the first six months of the year amid wider market turmoil.
The pension fund manager says the first half of the year was "extraordinarily difficult for investors" as geopolitical challenges, supply chain issues, recessionary threats, and soaring increases to both inflation and interest rates affected results.
It says that it avoided worse results thanks to its significant allocations to private investments, its focus on quality over growth stocks, and short-term credit over long-term bonds.
The fund, which manages investments to pay pensions for municipal employees from communities across Ontario, says it saw positive returns in infrastructure, real estate, and private equity, which helped to offset the negative performance of public equities and credit investments.
OMERS says that for the twelve months ended June 30 it had a net investment return of six per cent, or a gain of $6.7 billion.
In February, the fund reported that for the full 2021 calendar year it had a net investment return of 15.7 per cent, compared with a net loss of 2.7 per cent for 2020.