GIC posts 3.8% annualised real return over 20 years

It remains stable despite trade uncertainties, geopolitical upheaval and volatile markets

- Tay Hong Yi

The returns on GIC's investment portfolio have remained stable despite trade uncertainties, geopolitical upheaval and volatile markets, according to its annual report on July 25.

The sovereign wealth fund recorded a real rate of return of 3.8 per cent a year for the 20 years to March 31, 2025, down 0.1 percentage point from results a year ago.

This figure, which is adjusted for inflation, is over and above the global inflation that has occurred throughout the same 20-year window.

Without adjusting for inflation, GIC's annualised return came in at 5.7 per cent over the same 20-year period.

The figures are expressed in US dollars and calculated on a rolling basis, which means the real rate of return for the year ending March 31, 2005, will drop out of the calculation in 2026.

This 20-year annualised real rate is the main yardstick GIC uses, as these figures are said to better reflect the firm's mandate to achieve long-term returns exceeding global inflation. It does not publish the rate of return of each single year.

GIC's investments and asset mix also saw some changes over the last financial year.

Its portfolio exposure to the Americas - comprising North and Latin America - increased from 44 per cent to 49 per cent over the 12 months.

Chief executive Lim Chow Kiat told a briefing on July 24 that this increase was driven by the appreciation of existing holdings in the region and more capital deployment, especially to the US - GIC's biggest investment destination.

Conversely, its exposure to the Asia-Pacific region declined from 28 per cent to 24 per cent over the year.

The firm does not allocate a fixed limit on investments in any country or region, Mr Lim said, noting: "Every region competes for our capital in a way that changes reflect where we have found more or less opportunities."