International equity investments posted the highest performance in 2022, fixed income returns were the lowest during the year and private equity investments delivered the highest returns among alternative asset classes among those managing institutional money in Canada.

The BNY Mellon Canadian Master Trust Universe, from CIBC Mellon, is based on $290.3-billion worth of investment assets in Canadian investment plans. The average size plan represented manages $3.8-billion.

Among the 77 Canadian corporate public and university pension plans part of the universe, the median return in the fourth quarter of 2022 was 4.27 per cent. The one-year median return was a decline of 7.48 per cent as of December 31, 2022. The median 10-year annualized return was 7.3 per cent.

CIBC’s researchers say some positive developments late in the year included China relaxing its zero-COVID policy, slowing of interest rate increases and positive performance in October and November helping sponsors offset underperformance in the first half of the year. “Private asset classes continued to provide strong support, while fixed income was a clear detractor as interest rates rose through 2022,” says David Cohen, director of global risk solutions with BNY Mellon.

International equity investments performed best during the last quarter, with a quarterly median return of 13.38 per cent, while fixed income returns were the lowest during the quarter, posting a flat median return of just 0.43 per cent. Comparatively, the FTSE Canada Universe Bond Index for the quarter returned 0.1 per cent. Among non-traditional asset classes, private equity returned 2.1 per cent during the quarter, hedge funds ended the quarter with a median return of 1.74 per cent and real estate was flat, declining 0.19 per cent during the quarter.

Median returns for the whole year, ended December 31, 2022, were lower across the board, with one exception: real estate returned 10.63 per cent, while all other categories reported losses ranging between 4.89 per cent (Canadian equities) and 11.92 per cent (international equities).