Is the CPP Investment Board Producing ‘Value for Money’?
“National Post columnist Andrew Coyne last week described the CPP Investment Board, manager of Canadians’ collective CPP nest egg, as a “conspicuously bloated” organization that has “plunged into an increasingly esoteric, and risky, range of private investments” for “no appreciable payoff”.
According to Mr. Coyne, this “no appreciable payoff” result is not surprising as “active managers cannot consistently beat the market”.
In my open letter to him, I show that CPPIB’s active strategies have in fact produced a material $16 Billion of value above market returns, net of all costs, over the course of the last five years. Further, it is this positive result that should not be surprising. Logic suggests, and research confirms, that the kind of long-term active strategies the CPPIB is pursuing, if carried out by best-in-class people, should generate material ‘value-for-money’ over time. “
Keith Ambachtsheer – President – KPA Advisory Services
An Open Letter to Andrew Coyne In Response To His May 18, 2016 National Post Column: ‘CPP Board Can’t Escape Blame For Fund’s Bloated State’
By 6584 Keith Ambachtsheer – Open Letter: Here