-,.,. le28.TheBoardwasprovided withdetailed information onthest~ucture ofthe portfolio, whichwaswidelydiversified torenderthereturnlessdependent on individual markets andcurrencies. Globaldiversification wasanestablished investment principle endorsed bytheBoardmanyyearsago.Asat31March1985, $1,902million or50percentoftheFund'slong-term investments wereplacedin markets outside theunitedStates. TheFundwasinvested in46countries, including 23developing countries. Asforgeographic diversification, investments weremadein21different equitymarkets, including 5indeveloping countries. Of the$676million development-related investments, 78percenthadbeenmadethrough international andregional development institutions. Inordertoobtainbroad currency diversification, fundswereinvested in23different currencies. The policywastomaintain anoptimal balance between riskandrewardoffered through geographic andcurrency diversification. 29.Investments indeveloping countries werediscussed bytheBoardbearing in mindtheresolutions adopted bytheGeneral Assembly onthismatter. Direct investments indeveloping countries hadrisenby3.3percentto$151.6million. Thetotalamountinvested indevelopment-related securities hadrisento $676million, anincrease ofalmost12percent.Themanagement oftheFundkept closecontacts withtheWorldBank,theInternational Monetary Fund(IMF),the various regional development banks,governments andprivate sources inordertobe apprised ofnewinvestment opportunities. TheSecretary-General's representatives statedthatinrespect ofdevelopment-related investments, asforalloftheFund's investments, thefourcriteria ofsafety,profitability, liquidity and convertibility weremetatthetimetheinvestments weremadeandthatall investments werekeptundercontinuous. review. 30.TheBoarddiscussed theinflation-adjusted rateofreturn, whichhadimproved SUbstantially overthepastthree-andfive-year periods withaverage annualreal ratesofreturnof11.8percentand6.7percentrespectively. Because ofthe negative realratesofreturnduringanumberofyearsintheperiod1966to1980, whichhadbeencharacterized byrisinginflation, theannualrealrateofreturn overthepast25-year periodwasonly1.6percent~ 31.Members oftheBoardraisedanumberofspecific questions thatledto disc~ssion oftheinvestment policies, the.workings oftheInvestments Committee andtheextenttowhichitsadvicewasfollowed, thereturns obtainable from various short-term investments, thestatusofdevelopment-related investments, the prospects forthebanking industry, thepolicyregarding investments intobacco companies andtheoutlook fort~eUnitedStatesdollar. Withregardtoshort-term investments, onemembersuggested thatasmallpercentage oftheassets, for example 5percent,shouldbesetasideforthatpurpose. TheChairman ofthe Investments Committee indicated thatthesuggestion wouldbeexamined atitsnext meeting. Therepresentatives oftheSecretary-General responded toquestions regarding thedatainthereportand,together withmembers oftheInvestments Committee, addressed questions concerning thepolicy, strategy and-the decision-making process governing theinvestments oftheFund.TheBoardwas advised thatinresponse toGeneral Assembly resolutions onSouthAfrica, no investments hadbeenmadesince1976inentities thathaddirectorindirect -10-:he Its ts Of ,ugh h t be es :'lIs ~d L l,investments inthatcountry. Moreover, thepolicyhadbeentoproceed withprudent andcontinuous divestiture ofthoseinvestments madepriorto1976insuch corporations: theprocess hadbeencompleted inthesummerof1985. 32.TheBoardexpressed itsappreciation fortheparticipation andcomments ofthe Investments Committee. Italsotooknoteoftheexplanations givenbythe representatives oftheSecretary-General andthedetailed documentation provided. 2.Membership oftheInvestments Committee 33.TheSecretarY-General, inaccordance witharticle 20oftheRegulations ofthe Fund,conveyed totheBoardthenamesofthreemembers whomhewouldpropose, after consultation withtheAdvisory Committee onAdministrative andBudgetary Questions (ACABQ), totheGeneral Assembly atitsfortieth session forreappointment as members oftheInvestments Committee. TheBoardnotedtheSecretary-Generalis proposal. C.Requests addressed tothePension Boardin General Assembly resolution 39/246 34.Inresolution 39/246, theGeneral Assembly addressed tothePension Board
**Analysis**
This text appears to be discussing the investment policies and strategies of a pension fund, highlighting the importance of diversification, geographic and currency diversification, and the management of development-related investments. The text also touches on the performance of the fund, mentioning the inflation-adjusted rate of return and the returns obtainable from various short-term investments.

**Category**
Economic development, International trade