The Alberta Investment Management Company (AIMCo) which manages the Alberta Heritage Trust Fund, said last week it posted a 3.4% loss for the year ended Dec. 31, but remains well in the money over its longer term four- and 10-year plans.. Heritage Fund value .Despite the losses in the calendar year, AIMCo said it exceeded its benchmark performance returns by about 1.8% compared to the 5.2% loss it expected at the start of last year. It came out ahead over the longer term, however. Total fund return net of fees was 5.9% over four years — which included three years during the pandemic — and an impressive 7.2% over 10 years..Renewable resources was the best performing sector in 2022, gaining nearly 26%, followed by infrastructure at 16.8% and real estate at 4.6%, each strongly outpacing their benchmark. It was offset by a 10% loss in public equities and an 8.1% drop in the value of its money market and fixed income portfolio. In a statement released prior to the Easter long weekend, AIMCo said volatility was greater than it has been since the outset of the pandemic, and returns were muted by the significant drop in both public equities and fixed income markets as interest rates rose.. $40 billion in Heritage Fund transfers since 1982 .“With high inflation, rising interest rates and unprecedented declines in both public equities and fixed income markets taking place simultaneously, 2022 was an extremely challenging year for investors,” said AIMCo CEO Evan Siddall. “The strength of our investment team mitigated the impact of these unique markets, allowing AIMCo to outperform.”.AIMCo has about $158 billion under management, which includes about $18 billion in the Alberta Heritage Trust Fund. AIMCo also manages 16 other public pension, endowments and government funds in 30 separate capital pools. A more detailed report on each individual fund performance will be available when its annual report is released in June..After siphoning off a cumulative $40 billion, the fund’s annual income since 1982, the Alberta government in its February budget announced it would add $3 billion to the Heritage Fund coffers on top of the $2 billion committed under former premier Jason Kenney last year..Despite the short term losses, Siddall said AIMCo remains optimistic for the future.. Heritage Fund equity growth by year .“Despite the impact of short-term market conditions, we are focused on long-term performance, and our clients and their beneficiaries can be confident we are committed to ensuring they achieve their long-term goals,” he added..“With the expectation that the market will remain volatile, we will make strategic shifts in our investments that will enhance our commitment to private asset classes and securing strong partnerships globally, both of which will ensure we are well placed to continue to deliver on our purpose.”
