IMCO posts solid 2020 return, meets benchmark index
TORONTO—April 13, 2021 – The Investment Management Corporation of Ontario (IMCO) today announced that the weighted average return of its clients’ funds was 5.4% (net of all fees) for the year ended December 31, 2020. Client returns ranged from 0.2% to 7.1%, reflecting broad differences in their respective asset mixes, risk tolerances, and investment objectives. IMCO also met its consolidated return benchmark index for the year, as assets under management rose to $73.3 billion.
“We delivered solid results and met our benchmark, even as we implemented new investment strategies and managed through the volatile investment environment created by COVID-19,” said Bert Clark, President and Chief Executive Officer.
“Our approach is disciplined. We focus on those things that generate better risk-adjusted returns for our clients over the long-term,” he continued. “That means avoiding large asset class over weights, ensuring adequate liquidity to navigate times of market stress, and managing costs effectively.”
Throughout 2020, IMCO introduced new strategies for each asset class, which led to a complete overhaul of certain categories, such as public equities and public market alternatives. Transforming other asset classes, including real estate, is underway.
“Our clients are already benefiting from these new strategies,” said Clark. “For example, private equity and global credit both delivered double digit returns and significantly outperformed their benchmarks. Transforming our real estate portfolio will take longer.”
IMCO also focused its investment activities in 2020 by reducing its external manager roster by approximately half, eliminating costly fund-of-funds structures, and establishing new strategic partnerships.
“There will always be external managers with unique investment capabilities, so we are actively building partnerships with those best-in-class investors,” said Clark. “We have also built internal capabilities that enable us to significantly reduce costs on behalf of our clients.”
Notwithstanding the continued growth in internal investment, risk management, and enriched client service capabilities, IMCO exceeded its cost savings’ target for the year by 25% as it continued to provide its clients with tailored investment solutions and access to asset management capabilities, which they could not replicate on their own at the same cost.
More details on IMCO’s 2020 performance can be found in the 2020 Annual Report.
The Investment Management Corporation of Ontario (IMCO) manages $73.3 billion on behalf of its public sector clients. IMCO’s mandate is unique as it is the only purpose-built organization to deliver investment management services to broader public sector institutions in Ontario. In addition to creating better access to a diverse range of asset classes and investment opportunities, IMCO delivers portfolio construction advice and sophisticated risk management capabilities to its clients.
As a non-share capital corporation, IMCO delivers services on a cost recovery basis. It is an independent organization, operating at arm’s length from government and guided by a highly experienced and professional Board of Directors.
For more information, visit www.imcoinvest.com or follow IMCO on LinkedIn and Twitter @imcoinvest.
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