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Japan public pensions to follow GPIF into stocks from JGBs: sources

[TOKYO] Three Japanese public pension funds, with a combined US$250 billion in assets, will follow the mammoth Government Pension Investment Fund in shifting their investments out of government bonds and into stocks, two people directly involved in the decisions said.

The three funds and the trillion-dollar Government Pension Investment Fund, the world's biggest pension fund, will announce on Friday a common model portfolio in line with asset allocations recently decided by the GPIF, the people told Reuters.

Assuming, as expected, the three smaller mutual-aid pensions adopt the portfolio, that would mean shifting some 3.58 trillion yen (S$41.4 billion) into Japanese stocks, a Reuters calculation shows.

The GPIF in October slashed its targeted holdings of low-yielding government bonds and doubled its target for stocks, as part of Prime Minister Shinzo Abe's plan to boost the economy and promote risk-taking.