On Last Friday, Japan announced the most important shift in its asset allocation since 2006. This was the Japan's step in cutting its public pension fund, the world's biggest pool with US$1.1 trillion, taking greater risk into stocks, away from government bonds.
This week, Prime Minister Shinzo Abe was considering moving forward with the Government Pension Investment Fund (GPIF). This was to increase returns as part of his measures to revive Japan's economy. Reuters confirmed the report this week.
According to GPIF, the Japanese stocks allocation was increased by 12% from its 11% portfolio while decreasing JGB weighting to 60% from 67%. Limited impacts were suggested on markets as the change largely reflects adjustments already made in the portfolio.
As of December, the fund's latest public available allocations show 60.1% if the US$1.1 trillion under management was already in JGBs. A 12.9% was already allocated from domestic stocks.
Join the Conversation