Post on 18-Jul-2015
Steady Long-Term Performance
*For period ended 31 March 2014
• Rolling 20-year real rate of return
• Reflects our mandate to preserve and enhance the international
purchasing power of the reserves placed under our management
over the long term
Primary metric to evaluate investment performance
0
1
2
3
4
5
6
7
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
%
4.1% real return
per year over 20 years
GIC has sustained steady long-term investment
returns on the foreign reserves
*For period ended 31 March 2014
Steady Long-Term Performance
Return & volatility of the GIC & Reference Portfolios
Annualised nominal return (USD)*
Annualised volatility*Time Period
GIC Portfolio
Reference Portfolio
GIC Portfolio
Reference Portfolio
5-year
10-year
20-year
12.4%
7.0%
6.5%
13.9%
6.7%
7.2%
10.1%
10.2%
9.1%
11.6%
11.8%
10.8%
*For period ended 31 March 2014
Steady Long-Term Performance
31 March 2014 (%) 31 March 2013 (%)Asset Mix
Developed Markets Equities
Emerging Markets Equities
Nominal Bonds & Cash
Inflation-linked Bonds
Real Estate
Private Equity
100 100TOTAL
29 36
19
31
5
7
9
17
29
2
8
8
Mix of growth and defensive assets
*For period ended 31 March 2014
Portfolio Composition
42%
29%
27%
AMERICAS
EUROPE
ASIA
2%AUSTRALASIA
Broad geographical diversification
*As of 31 March 2014
Portfolio Composition
31 March 2014 (%) 31 March 2013 (%)Geographical Distribution
Americas
Europe
Asia
Australasia
100 100TOTAL
United States
Latin America
Others
Others
Eurozone
United Kingdom
Others
North Asia
Japan
34
4
4
42
8
14
7
29
10
14
3
27
2 2
36
4
4
44
8
11
6
25
10
13
5
28
3 3
Geographical Distribution
*As of 31 March 2014
Portfolio Composition
0
0.05
0.1
0.15
0.2
-20 -15 -10 -5 0 5 10 15 20 25 30
Simulated Annualised Returns (%)
Simulated 5- and 20-year annualised real returns of the Reference Portfolio
5-year Annualised Real Returns 20-year Annualised Real Returns
• Wide dispersions of returns
• Narrower dispersion for
longer horizon
Prospects of Investment Returns
REFERENCE PORTFOLIO
Passive Portfolio; set at 65% global equities; 35% global bonds
Represents the government’s risk level
+ =
Allocation among six core asset
classes
Key driver of returns over the
long term
Approved by the GIC Board
Comprises overlay of active,
skill-based strategies
Adopted by GIC management
Overseen by GIC Investment Board
Represents actual exposures of the
GIC portfolio
Within risk limits set by
Government
Investment Framework
Private Equity
Real Estate
Inflation-linked bonds
Nominal bonds & cash
Developed Market equities
Emerging Market Equities
11%-15%
9%-13%
4%-6%
25%-30%
20%-30%
15%-20%
Policy Portfolio
Asset Class Highlight
Private Equity • Enables diversification• Better long-term returns, albeit with highest risk, among the major asset
classes
Developed Market Equities
Emerging Market Equities
Nominal Bonds
CashInflation-linked Bonds
Real Estate
Private Equity
0.0%
2.5%
5.0%
7.5%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0%
Ex
pecte
d R
etu
rn
Expected VolatilityLow
Hig
h
High
Lo
w
Asset Class Highlight
Our Approach to PE • A long-term investor like GIC can afford to ride through the higher
volatility of PE in return for a higher expected long-term return• We began investing in PE in 1982; currently we have > 100 manager
relationships and >100 investee companies• Our PE investments have done well, outperforming public equities since
introduction
We are one of the largest and most established PE investors globally because:• We have strong relationships with a number of top quartile managers.• We have the capabilities to source and lead deals for direct investments in
companies across multiple industry sectors.
Asset Class Highlight
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