Strong public equity, fixed income, and private equity performance despite challenging investment environment
Edmonton – Alberta Investment Management Corporation (AIMCo) today announced a Balanced Fund net investment return of 8.0%, or $8.9 billion, for the year ended December 31, 2023. This result was approximately 1.4 percentage points below the benchmark return of 9.3%. Annualized long-term results were 5.3% over a four-year period and 7.3% over a ten-year period, representing net investment returns of $22.5 billion and $62.2 billion, respectively.
AIMCo invests on behalf of pension, endowment, insurance, and government clients in Alberta. Each client determines their long-term asset mix according to their objectives and risk appetite, which is a key determinant of potential returns along with AIMCo’s execution in public and private markets. AIMCo’s Balanced Fund reflects a typical client mix of investments across all asset classes. AIMCo’s Total Fund return reflects the aggregated results of all client accounts, including clients who exclusively choose fixed income and money market investments to achieve their objectives. In 2023, the Total Fund returned 6.9%, which was 1.8 percentage points below its 8.7% benchmark return. Total client assets under management were $160.6 billion as at December 31, 2023.
“During 2023, persistently high inflation and interest rates and challenging geopolitical factors combined to affect global markets,” said Evan Siddall, Chief Executive Officer, AIMCo. “Our investment teams continued to seize opportunities and effectively mitigate emerging risks to deliver a solid return for our clients and the Albertans they serve.”
In contrast to 2022, both Public Equities and Fixed Income posted significant gains of 15.8% and 7.7% respectively in 2023. AIMCo’s Private Equity portfolio also generated a return of 6.7%, while the Infrastructure and Renewables portfolio returned 3.5%. Real Estate, which was particularly affected as economies adjust to post-pandemic work practices, was down 8.4%. Mortgages and Private Debt & Loan had positive returns of 4.5% and 9.6%, respectively.
“With a continued focus on long-term results, we made significant strides in implementing our new investment strategy and translating it into asset class specific strategies, while navigating challenging markets throughout 2023,” said Marlene Puffer, Chief Investment Officer, AIMCo. “As we set our sights on 2024, we will focus on enhancing value in our existing direct investments and on managing private asset class allocations in this environment of capital constraint and higher interest rates.”
Investment Performance¹
For the Year Ended December 31, 2023
Investment Performance by Asset Class
For the Year Ended December 31, 2023
¹All performance results are net of fees and costs.
Detailed performance information will be available in AIMCo’s 2023 Annual Report, which will be released in June 2024.
About Alberta Investment Management Corporation (AIMCo)
AIMCo is one of Canada’s largest and most diversified institutional investment managers with more than C$160.6 billion of assets under management as at December 31, 2023. AIMCo invests globally on behalf of pension, endowment, insurance, and government funds in the Province of Alberta. With offices in Edmonton, Calgary, Toronto, London, Luxembourg, New York, and Singapore, our more than 200 investment professionals bring deep expertise in a range of sectors, geographies, and industries.