As the administrator of the Plan, LAPP Corporation develops and maintains an investment policy — known as the Statement of Investment Policies and Procedures (SIPP) — that establishes the investment principles, policy guidelines, asset mix, and overall approach to the investment management of the Plan’s investments.
Alberta Investment Management Corporation (AIMCo) is responsible for the day-to-day investment management of LAPP’s portfolio of assets in accordance with the SIPP. By legislation, the Government of Alberta has designated AIMCo as the sole provider of investment management services to LAPP.
During the second quarter, the Fund’s investments generated a return of +1.96%, outperforming the Plan’s policy benchmark by 0.14%.
Both global stock and bond markets generated positive returns in Q2, despite some in-quarter volatility. Inflation continued to trend downward toward central bank targets, helping overall market sentiment. Equity markets continued to be driven by the largest, US mega-cap technology companies. Fixed-income markets recovered a portion of their Q1 losses, but longer duration fixed-income indices remain negative year-to-date.
As at June 30, 2024, the LAPP portfolio generated a four-year annualized return of +6.94%, outperforming the policy benchmark return of +5.25% by 1.69%. Over a four-year period, Fixed Income, Public Equities, Inflation Sensitive and Alternative Investments, and Private Equity — all of the major asset class categories — posted positive excess returns.
On an absolute basis, the best performing asset classes over four years were Private Equity, Global Developed Equities, and Canadian Equities.
For detailed quarterly investment results of the Plan, visit Funding and Investment.
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