February 2, 2018 / 6:33 AM / 6 months ago

Japan's GPIF sells net 52 bln yen of domestic equities in Q4

TOKYO, Feb 2 (Reuters) - Japan’s mammoth Government Pension Investment Fund sold a net 52 billion yen ($475 million) of domestic equities in the fourth quarter as stocks surged to their highest level in a quarter of a century, a Reuters calculation based on the fund’s results showed on Friday.

That marked the GPIF’s largest quarterly net selling of domestic stocks since it revamped its investment strategy in 2014 by doubling its equities allocation and reducing its reliance on domestic bonds. It had sold a net 20 billion yen worth of Japanese shares in July-September 2016.

The GPIF does not report specific buying or selling amounts but Reuters calculated the figures by comparing investment amounts and asset revenue with those from the previous quarter.

A GPIF spokeswoman declined to comment on the reason for selling.

Still, the fund’s Japanese stock holdings reached a new peak of 26.05 percent of its total assets of 162.7 trillion yen, compared with 24.35 percent at end-September.

The Nikkei 225 stock average gained 12 percent during the quarter and in November touched its highest level since January 1992. It has extended gains and is up about 2 percent in the year to date.

As stocks also charged ahead globally, the GPIF earned a 3.92 percent return, or a 6 trillion yen gain, on its total investment in the fourth quarter, the fund said.

Its Japanese stock portfolio achieved an 8.68 percent return and its foreign stock portfolio earned 5.65 percent.

The pension fund allocated 27.67 percent to domestic bonds, 14.13 percent to foreign bonds, and 25.08 percent to foreign stocks. The remaining 7.06 percent was held mainly in cash. ($1 = 109.6600 yen) (Reporting by Takashi Umekawa; Editing by Chris Gallagher)

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