Broad diversification is our most important risk management tool.

It’s a simple concept: we don’t put all of our eggs into one basket. It’s more complex in practice. We put considerable effort into choosing an appropriate asset-mix policy and we take care not to duplicate risks across portfolios. Diversifying investments reduces overall fund volatility and risk, and increases the potential for better returns.

We invest globally. Exposure to the economies of various countries helps to reduce overall volatility and offers the potential for better returns than if investments were confined to one country or asset class.

Both our private and public equities programs have large holdings in the United States and Europe, and we have made sizeable investments in Brazil and Chile after conducting extensive due diligence in those countries.

In our fixed income portfolios, we hold Government of Canada nominal and real-return bonds, U.S. Treasury Inflation-Protected Securities (TIPS), Province of Ontario debentures, provincial and corporate debt, emerging market, mezzanine and private debt.

In our real assets portfolios, we hold an array of infrastructure and timberland investments in different countries and commercial real estate assets across North America.

The fund is also diversified through exposure to commodities and absolute return strategies. The goal of the absolute return strategies is to generate positive returns that are uncorrelated to other asset classes.