Caisse de dépôt et placement du Québec’s (CDPQ) is yet another prominent pension fund that has shifted its investment focus towards the private markets. According to a report from Institutional Investor, CDPQ more than doubled its investment in private equity from five years ago and tripled its investment in infrastructure programs. And the strategy paid off, according to the report:
“The two strategies helped buffer CDPQ’s overall portfolio against the global downturn in 2018, with infrastructure pulling in 11.2% for the year and private equity garnering 16.6%. The total $309.5 billion portfolio generated a 4.2% return in 2018, with its equity markets holdings generating a 0.9% return for the period.”
Pension funds like CDPQ and California’s CalPERS continue to shift more investment towards private and alternative assets in the face of unpredictable public market conditions. Undoubtedly, this will facilitate the need for more private market regulatory oversight as well as transparency and liquidity, something that digital securitiescould provide the answer for.