Change in policy gives fund better rates of return
The Government Pension Fund yielded an annual rate of return on investment of 7.05 per cent in the first nine months of the year, thanks to its policy of shifting its investments in debt instruments to longer maturities.
The state-owned fund reported yesterday that as of the end of September, it had Bt318.81 billion worth of assets under management. The fund's real return, excluding core inflation, would still be attractive at 5.33 per cent. Tracking back over its three- and five-year performances, the fund obtained 6.82 per cent and 7.18 per cent, respectively, in returns. The state-owned fund generated a net rate of return to its members of 11.84 per cent in 2003, 2.02 per cent in 2004 and 6.83 per cent last year. Of the GPF's portfolio as of the end of September, 71.64 per cent was invested in domestic debt instruments, 10.36 per cent in domestic equities, 5.06 per cent in fixed-income tools abroad, 4.21 per cent in foreign securities, 3.98 per cent in property and 4.75 per cent in alternative investments. GPF secretary-general Visit Tantisunthorn said the fund had shifted from short-term fixed-income investments to longer terms. Earlier, the average maturity of its bond investments was 2.5-2.6 years, but it is now longer than three years. In September, the GPF set up the US$520-million (Bt19.1 billion) GPF (Thailand) Investment Fund through Russell Investor Investment, to manage its investments abroad. Also in September, the GPF earmarked another Bt1 billion for investment in the Thailand Futures Exchange (TFEX). In accordance with Finance Ministry regulations, the GPF is now allowed to invest in the TFEX. Visit said the GPF would not act as a market player in the exchange, but would instead use the derivative tools for hedging proposes.
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