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The Policy Portfolio comprises six asset classes: Developed Market Equities, Emerging Market Equities, Nominal Bonds and Cash, Inflation-linked Bonds, Private Equity, and Real Estate. Through the diversity of asset classes, the Policy Portfolio is expected to generate good risk-adjusted returns over a 20-year period.
The strategies are funded by the sale of assets in the Policy Portfolio, and so must generate higher returns to compensate for the cost of capital and higher risk involved.
We focus on owning assets with good long-term earning potential, at reasonable prices. Capitalising on our core strengths, we work to find attractive bottom-up investment opportunities.
Characterised by a Portfolio made up of 65% global equities and 35% global bonds (“65-35”), the Reference Portfolio is not a benchmark, but an expression of the overall risk that the Client is prepared for the GIC Portfolio.
GIC’s investment strategy is to build a portfolio comprising asset classes that can generate good long-term returns above global inflation, while adhering to our Client’s risk parameters. On occasion, there may be a difference between the risk exposure of GIC and the Reference Portfolio. GIC may adjust its risk exposure, in times of market exuberance or when the opportunity arises. This is part of a disciplined, professional approach to long-term value investing.
Disciplined, long-term value investing
We assess the value of an asset and keep to the price discipline, even if it may mean going against market sentiments.
To do so, we consider drivers of risk and return for each asset class to establish where true fundamental value lies. This involves both top-down and bottom-up analyses.
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