[Asia Economy Reporter Park So-yeon] The National Pension Service's operating rate of return as of the end of the third quarter this year was tentatively estimated at -7%.
On the 29th, the Fund Management Headquarters of the National Pension Service announced that as of the end of September this year, the National Pension Fund reserves amounted to 896.6 trillion KRW, with a rate of return of -7.06% from the beginning of this year to the end of September.
By asset class (based on amount-weighted rate of return), domestic stocks recorded -25.47%, foreign stocks -9.52%, domestic bonds -7.53%, foreign bonds 6.01%, and alternative investments 16.24%, showing losses in domestic and foreign stock and domestic bond investments.
The headquarters analyzed that the major cause of these losses was the simultaneous downturn in global stocks and bonds that continued from the beginning of this year.
The U.S. Federal Reserve (FED) showed a strong monetary tightening stance with three giant steps (0.75 percentage point increases in the base interest rate), and the prolonged Russia-Ukraine war intensified commodity price increases and supply chain issues, sustaining inflation concerns. Additionally, worries about the European energy crisis increased volatility in domestic and international stock markets.
As of the end of September, the Korean KOSPI fell 27.61% compared to the end of last year, and the U.S. Standard & Poor's (S&P) 500 index also plunged 23.62%.
In the case of alternative investments, which posted double-digit returns, most were analyzed to be from interest and dividend income and foreign currency translation gains due to the rise in the KRW-USD exchange rate.
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