GIC's Investment Framework

The Strategic Portfolio

The Strategic Portfolio represents the risk appetite and long-term return expectations of the Client. It comprises three broad asset groups that capture three important drivers of returns: Equities, Fixed Income, and Real Assets.

The GIC Portfolio

The GIC Portfolio aims to outperform the Strategic Portfolio over the long term, while operating within the approved risk parameters. It is constructed based on the key principles of diversification, granularity, and agility. The GIC Portfolio comprises a broad range of strategies that add value to the Strategic Portfolio through additional return streams, bottom-up security selection, and value creation.

Importantly, we review the risks of these strategies and rigorously stress-test them to assess their performance under various extreme but plausible market conditions, including macroeconomic and geopolitical events.

Principles of Portfolio Construction

The GIC Portfolio includes active, skill-based strategies that seek to outperform market benchmarks over appropriate time horizons and within approved risk limits. The portfolio is constructed based on these principles:

• Diversification: GIC invests across a broad range of assets with varying risk and return profiles to build a resilient portfolio capable of withstanding market uncertainty. This requires a deep understanding of the underlying risks of each active strategy across different scenarios. GIC diversifies across multiple dimensions—assets, geographies, sectors, and time horizons—to manage concentration risks and capture opportunities in different market environments. For example, we invest in both cyclical assets (e.g., equities and transport infrastructure) and stable assets (e.g., logistics, utilities, and inflation-linked investments). This ensures that our portfolio is resilient across market cycles.

• Granularity: GIC’s global presence, long-term horizon, and sector expertise enable us to deploy capital with greater granularity. We do so by breaking down broad themes into more targeted, investible segments. By identifying and allocating capital across specific sub-sectors, strategies, and asset characteristics with distinct risk and return drivers, we can reduce risk and generate more resilient or higher sources of return.

• Agility: The GIC Portfolio is rebalanced regularly to maintain the intended risk-return profile. Within the risk parameters defined by the Strategic Portfolio, we have the flexibility to adjust allocations across multiple active strategies and expand GIC’s investable universe by exploiting GIC’s investment capabilities. This means putting more capital into areas where we think GIC has better understanding, access to market opportunities, and ability to structure and manage investments.