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Ontario Teachers posts 11.8 percent return for 2014

The pension beat its benchmark by 170 basis points

The Ontario Teachers’ Pension Plan posted an 11.8 percent return on its investments for 2014, according to its recently released annual report. The bumper returns also pushed assets to a new high of $154.5 billion, up from $140.8 billion at the end of 2013.

Investment earnings for the year were $16.3 billion, up from $13.7 billion in 2013.

The pension will go into 2015 with a large cash position following the strong returns of 2014. The plan had a preliminary funding surplus of $6.8 billion to start 2015, the second surplus in as many years.

The pension’s focus on direct private investments in 2014 has also been a boon. Investments by Teachers' Private Capital (TPC) rose to $21.0 billion at year-end from $14.8 billion a year earlier. The private capital portfolio return for 2014 was 22 percent, above the 16.3 percent benchmark.

The pension is said to be considering opening a new office in South Africa later this year as well.

“These strong results were achieved in a turbulent investment environment,” said Ron Mock, president and chief executive officer. “With continuing low interest rates, intense competition pushing up asset prices, the slide in oil prices and resulting stock-market volatility, 2014 was not an easy year for investment success.”