Rising risks:

Company expects rising risks and market volatility

A file picture showing an employee of Temasek Holdings walking along the corridor of the firm’s office in Singapore. The Singapore investment firm signalled plans to slow investment for as long as 18 months on rising risks and market volatility.

SINGAPORE: Singapore state investment firm Temasek Holdings Pte signaled plans to slow investment for as long as 18 months on rising risks and market volatility after the end of a global rally that spurred record assets.

The value of the firm’s portfolio climbed 12% to S$308bil (US$227bil) in the year to March 31, the second straight record, it said. Total shareholder return in Singapore dollars was 12%, down from 13.4% in the previous period.

Temasek is among large investors recalibrating their expectations after the stock rally came to a shuddering halt and US President Donald Trump embarked on a series of trade spats, especially with China.

Highlighting increased risks in the “nearterm,” the state fund said it also expects global growth to cool.

“We may recalibrate and slow our investment pace over the next nine to 18 months,” Alpin Mehta, managing director of investment, said in a statement.

Temasek made S$29bil in new investments, up from S$16bil in the previous year. Divestments totaled S$16bil.

Over 10 years, the total shareholder return in Singapore dollars was 5%. From inception in 1974: 15%.

The investment firm’s early purchase of Alibaba Group Holding Ltd stock keeps paying off, with that company’s shares jumping 70% over the period. It also benefited from gains in Chinese banks.

Among the Singapore holdings, which make up more than a quarter of the portfolio: DBS Group Holdings Ltd surged 42%, Singapore Airlines Ltd climbed 7.7% and Singapore Telecommunications Ltd slumped 14%.

By way of comparison, sovereign wealth fund China Investment Corp posted a 17.6% return on its overseas investments last year, the best annual performance in its decade-long history, as global stocks rallied throughout the period.

CIC is boosting allocations to direct and alternative investments for more stable returns and to cut exposure to volatile public markets, company executives have said.— Bloomberg