GIPF will not make rushed investments amid COVID-19 – Adequate assets and risk reserves put aside
Long-term investor, the Government Institutions Pension Fund (GIPF) said it will not make any rushed investment decisions in light of the COVID-19 which has had an effect on global financial markets.
In order to control the effect of market fluctuations such as currency movements during these volatile times, the GIPF Board has proactively taken protective measures such as currency hedges, GIPF CEO, David Nuyoma said Tuesday.
“We continue monitoring the markets and will take any other necessary mitigating actions as and when it becomes necessary. The diversified nature of our investments and income streams in terms of asset allocation is another risk mitigating measure the Fund has in place,” he said.
Above all, the Fund has a liability-driven strategy that is comprised of a robust Asset Liability Modeling (ALM) process, he added.
“The ALM further feeds into the risk and return parameters known as the Strategic Asset Allocation (SAA), which GIPF as a long-term investor uses to implement its investment philosophy. The ALM process allows the Fund to adapt to prevailing economic market conditions, relative to its liabilities, and factors in variables that will ensure that GIPF does not only safe-guard the assets of the Fund, but also grow them through investing in return-seeking investment opportunities,” he said.
Meanwhile he said adequate assets and risk reserves totaling some around N$25.9 billion have been put aside to ensure that the liabilities are not understated, and that the Fund can pay the promised benefits as they fall due.
“These reserves provide the necessary cushion in times such as these,” he concluded.