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Caisse dumping bonds..."Canada's bond-dumping frenzy continues..."

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#1 Pulp_Cutter


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Posted 27 May 2013 - 06:04 AM



Canada’s biggest pension-fund manager will “significantly” cut its C$64 billion ($62.3 billion) allocation to bonds as the fixed-income market’s foothold among its most loyal base of investors grows less certain.

Caisse de Depot et Placement du Quebec Chief Executive Officer Michael Sabia said he’s scaling back fixed-income investments that account for 36 percent of its C$176 billion of assets...


Canadian government bond yields have fallen to almost record lows, draining income for pension funds....


Sabia, 59, plans to increase investments in assets such as real estate, infrastructure and private equity to reduce volatility in the Caisse’s returns. He’s also planning a C$20 billion fund that invests in the equity of large, global companies such as Nestle SA (NESN) and Colgate-Palmolive Co. (CL)

“To me, there’s less risk sitting in that portfolio than there is sitting in a fixed-income portfolio,” Sabia said. “With yields where they are, people are searching for yield anywhere they can, and that’s had a ripple effect on asset pricing across a variety of different asset classes.”

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Posted 27 May 2013 - 09:08 AM

Yield starvation. They obviously did not stack up enough resources to sustain them for all eternity. Bits are dying faster than they are being produced and now they are in search of greater sustenance to escape starvation.

#3 detachedbear


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Posted 03 June 2013 - 02:09 PM

Good post pulp. I don't know if it indicates a new direction in bonds, but it could.

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