Canadian pension fund assets climbed strongly in the fourth quarter of 2013, powered by rising stock markets, according to the latest data from Statistics Canada.
StatsCan reported today that the market value of employer-sponsored pension funds in Canada totalled $1.3 trillion at the end of the fourth quarter, which is up 5.8% from the previous quarter.
Rising stock markets powered the gain, with pension fund investments in stocks rising 9.4% in the fourth quarter. This outpaced the 6.4% gain for the Toronto Stock Exchange over the same period.
While stocks rose most in the quarter, they remain second to bonds in terms of overall asset allocation. The value of bond holdings increased 3.6% in the quarter; and they now represent 34.6% of total assets, compared to 31.7% in stocks.
StatsCan also says that the value of foreign investments rose 9.0% in the fourth quarter. And, it notes that 33.9% of total pension fund assets are in foreign investments.
Pension fund revenue surged by 27.6% in the fourth quarter to $42.2 billion. In the period, investment income rose 36.4% and profits from the sale of securities increased 36.5%, while contributions were up 12.3% quarter over quarter. Over the same period, expenditures rose 6.8% to $18.1 billion, and net income grew from $16.2 billion in the third quarter to $24.2 billion at the end of the fourth quarter.
StatsCan says that more than 6.1 million Canadian workers are members of employer-sponsored pension plans. Of this total, 5.2 million workers belong to pension plans with assets managed by trusteed funds; the remainder are managed by insurance company contracts.