The Ontario Teachers Pension Plan (OTPP) is reevaluating its exposure to private equity after it experienced its first downturn in 16 years.

The $200 billion asset manager's holdings dropped by about $7.4 billion last year, Bloomberg reported.

The Plan underperformed relative to the benchmark return of 11.7% by 5.0%, or $12.0 billion in negative value add. 

This underperformance was driven by several factors including "continued robust performance in our public market-linked benchmarks, as well as constrained performance of certain assets particularly the private equity, infrastructure and real estate asset classes," OTPP said in a press release.

"Our private equity and real estate teams had a more challenging year given broad sector headwinds. We responded with disciplined year-end valuation adjustments to reflect current market conditions, which weighed on performance," Jo Taylor, president and CEO, said.

Despite the decline in its private equity portfolio, the fund still generated a 6.7% return last year. This was primarily driven by strong performance in gold, venture growth, and public equities asset classes, OTPP noted. Bloomberg also added that the pension plan's exposure to Elon Musk's SpaceX drove gains.

Going forward, the pension plan will only invest in three sectors: financial services, technology, and services.

As of Dec. 31, 2025, the pension plan had $50.8 billion in private equity assets under management.

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