Monday, 8 August 2011

Singapore's GIC portfolio - measuring returns

The following letter was sent to the Straits Times Forum on July 31. As of August 8, the letter has not been published.  
To the Editor:
Singaporeans welcome GIC's recent announcement to reveal additional information by providing five and ten year annual rates of return on its portfolio.
Based on published reports, it seems that GIC's portfolio information is reported to the media in US Dollars. Certainly, information on GIC portfolio returns for the period ended March 31, 2011 recently published by the media utilize US Dollars as the measurement currency.
GIC is a Singaporean entity. Singaporean businesses typically account for revenues and expenses in Singapore Dollars. Naturally, Singaporeans also measure investment returns in Singapore Dollars. Hence, it is unusual that GIC publicizes investment performance only in US Dollar terms.
In a world where exchange rate movements can add or subtract significantly from investment performance, GIC and the media should report portfolio analytics measured in Singapore Dollars. For Singaporeans, investment returns are more meaningful if reported in Singapore's national currency.
Sincerely,
Imran Ahmed

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Imran is a business and management consultant. Through his work at Deodar Advisors, Imran improves the profitability of small and medium sized businesses. He can be reached at imran@deodaradvisors.com.

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