Permanent Fund up 1.2 percent in third quarter
MAY 16 - The Permanent Fund was up 1.2 percent in the third quarter of fiscal year 2016, trailing the performance benchmark return of 2.3 percent. The recent positive performance was not able to fully overcome losses earlier in the year, producing a small loss of 0.9 percent for the year-to-date, compared to the performance benchmark of -0.3 percent. The fund ended March 31, 2016 with a value of $52.5 billion.
“A sharp dip in U.S. and overseas markets held through to mid-February, before turning back up to end March just below where they started in January,” said CEO Angela Rodell. “The mid-quarter rally appears to have been fueled by several things that calmed investors’ concerns: increases in oil and other commodity prices, European Central Bank stimulus actions, including buying corporate bonds for the first time, and signals from the Federal Reserve that short-term interest rates will not rise in the coming months.”
The Fund’s U.S. stock portfolio returned 0.3 percent for the quarter and -2.0 percent for the fiscal year-to-date. The non-U.S. portfolio returned 1.3 percent for the quarter while the global stock portfolio returned 0.1 percent, bringing the year-to-date returns to -9.3 percent and -4.4 percent respectively.
Other asset classes have fared better than stocks during part or all of the fiscal year. The U.S. bond portfolio gained 3.2 percent for the quarter and 2.9 percent for the fiscal year-to-date, while the non-U.S. portfolio returned 5.2 percent and 3.9 percent for the respective periods. Real estate investments also performed well, up 2.1 percent for the quarter and 8.4 percent for the fiscal year-to-date.
Performance was mixed for the Fund’s alternative assets. The infrastructure and other real assets portfolio returned 0.9 percent for the quarter and 10.2 percent for the fiscal year-to-date, while the private equity portfolio was up 4.2 percent for the quarter and 10.6 percent for the fiscal year-to-date. The Fund’s absolute return investments lost 1.5 and 2.8 percent for the respective periods.
Performance information for additional Fund portfolios and time periods is available at www.apfc.org, along with current and historical financial statements and past performance reports.
The Permanent Fund recorded $719 million in statutory net income during the quarter, bringing the year-to-date total to $1.9 million. This is the amount used to calculate the annual Permanent Fund Dividend.