Thread by @yomeeks

The Pension War Room™️has returned from the wilderness to bring you the latest Heritage Fund Annual Report! Get your copy ⬇️⬇️. An interesting read by any account. Invested by @aimcoinvests and a great 1-year return.
alberta.ca/heritage-savin…

Earned an 11.8% one year return against a benchmark of 7%. Which is great by any measure. Also, one year returns don't mean much, but encouraging nonetheless.

Almost $20 billion in size now; next to the pension funds this would be a "small" fund. #AbLeg

@aimcoinvests investment cost was 0.90% (90 bps) both last year and the year before. This is a bit shocking. Asset mix is different than ATRF so a direct comparison is not warranted (bonds cost less to invest than other assets for ex). #AbLeg

Shocking because ATRF's multi year investment cost average was around the mid seventies (0.75%). And, if recall the now famous words of @ToewsforAlberta: AIMCO can bring that cost down by at least 0.25% to a cost of 0.48%. Which is highly improbable. #AbLeg

As a taxpayer I don't mind paying 0.90% for a return that exceeds benchmark. And, in the fine print, this report admits falling short in that area. #handsoffmypension

See Note 8 (c) for the performance expectation.
"In the SIP&G, the Ministry of Treasury Board and Finance expects that the investments held by the Fund will return 1% above the policy benchmark over a rolling five-year period."

So, over a more reliable 5 year period AIMCO would be doing its job if it returned 1.00% above benchmark more often than naught.

The Heritage Fund returned 0.4% over benchmark over 5 years. (Note 8). 0.6% over bench over 10 years. Poor overall. #notmadethemark #notgood

This is blame-able on the VOLTS losses that @aimcoinvests now only references as a "COVID market swoon". (I am not making this up.)

Materially less than bench? That doesn't make me angry. Paying out huge investment bonuses as if this is top quartile performance does. #AbLeg

When I was Chair of the ATRF Board I authorized bonuses that would make you blush. But, you can rest assured that it was for substantial performance in aid of securing the fund's objectives. #AbLeg

After all, who can forget the famous quote from the DM of TBF Athana Mentzelopolous (June 23, 2020):
“I would like to be very clear that AIMCo has a consistent record of outperforming their mandated benchmarks.”

Yeah. I don't think so. #AbLeg