China’s CIC sovereign fund posts first losses in four years

CIC: Battered by falling commodity prices and weak currencies, China’s $814bn China Investment Corp sovereign wealth fund has reported its first loss on overseas investments in four years. While total assets climbed 9% to $813.8n last year, the net return on overseas investments fell to -2.96% from  5.47% in 2014. “Given uncertainties like the Fed’s fickleness on raising rates, Brexit and fluctuations of major currencies, 2016 is likely to be another year of sluggish growth, coupled with subdued inflation, low productivity, and lacklustre trade,”  CIC’s chairman and CEO Ding Xuedong wrote in the preface to the fund’s annual report that was published on Friday.
The report reveals that approximately 47% of CIC’s 2015 global portfolio was invested in stocks, 14% in fixed income, 22% in long-term investments, 13% in absolute return, and about 3% in cash.
In recent years it has been ramping up its investment in real estate and infrastructure. In 2015 it paid over $2.45bn for Investa Property Group’s portfolio of nine office towers in the biggest direct real estate transaction in Australia’s history; and earlier this year it spent  around $700m on a 49% stake in Brookfield Property Partners’ office tower at 1 New York Plaza.

Source: atimes