The median return of Canadian defined benefit pension plans was 4.11 per cent for the fourth quarter of 2021, the seventh consecutive positive quarterly return following the initial reaction to the coronavirus pandemic in the first quarter of 2020.
BNY Mellon Asset Management Canada Ltd.’s master trust universe, which comprises 84 Canadian corporate, public and university pension plans, found the one-year median return at the end of 2021 was 9.48 per cent, while the median 10-year annualized return was 9.39 per cent.
“Despite ongoing challenges from the Omicron variant, global inflationary concerns and the expected tightening of monetary policy, Canadian plan sponsors posted strong returns across all traditional asset classes this quarter,” said David Cohen, director and manager of global risk solutions consulting at BNY Mellon, in a press release. “The BNY Mellon Canadian master trust universe median return was positive, led by Canadian and U.S. equities for this quarter and all of 2021.”
Among traditional asset classes, the U.S. equity universe median posted the highest performance, with a quarterly median return of 7.35 per cent, while international equity returns were the lowest, posting a quarterly return of 1.95 per cent.
In terms of non-traditional asset classes, real estate delivered the highest performance, with a quarterly median return of 4.31 per cent, followed by private equity (3.25 per cent) and trailed by hedge funds (0.03 per cent).