Be boring, follow the Canada Pension Plan

Recently I read about our Canada Pension Plan (CPP) reaching $200-billion mark in assets for the first time.  As one of the 10-largest retirement funds in the world, it’s a financial behemoth.  Here’s how our money is invested by region:

Canada Pension Plan

Here it is by sector:

Canada Pension Plan

Here are my quick takeaways from how CPP invests and what we can easily copy in our portfolios:

The boring and simple CPP investing approach has allowed this massive fund to reach record-highs and earn an annual rate of return of about 5% over the last ten years after inflation is factored in.  Most investors would be more than pleased with these results over the same investment period.

Any lessons learned here for your portfolio?

10 Responses to "Be boring, follow the Canada Pension Plan"

    1. I think boring and steady will win the race, my portfolio is banking on it 🙂

      That was point exactly, a home is great (real estate) but it shouldn’t be most of your portfolio value. Just my opinion.

  1. Interesting that real estate only makes up around 10% of the portfolio. I’d say for most people real estate makes up 40% or more of their net assets. As you said it looks like diversification is important and this portfolio is an example of how a diversified portfolio can still have respectable returns

    1. Hey Dan,

      Yes, which I think is a lesson for all of us. I hope to have my house only as a small percentage of my assets; definitely not worth the majority. I have to live somewhere after all. This would be better diversification don’t you think?


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