How GIC stress-tests and diversifies its portfolio

Angela Tan

Published Mon, Jul 27, 2020 · 09:50 PM

Singapore

IN navigating an investment world plagued with low returns and heightened uncertainties, GIC stress- tests its portfolio across a range of plausible scenarios to ensure it is robust, a move which helped the investment fund protect Singapore's foreign reserve under its care against what it saw was significant market damage.

Jeffrey Jaensubhakij, GIC's group chief investment officer, shared with the media on Monday that GIC went into its last financial year with a fear that some risks in the global economies were rising and valuations over-stretched. It took a "pretty defensive stance" which helped cushion the portfolio when the Covid-19 pandemic hit this year.

"Last year, GIC reduced its risk asset exposure and turned more defensive. That helped protect the portfolio against what we saw was significant market damage," said Dr Jaensubhakij, who added that as a result, the pandemic's impact on GIC's…