TORONTO, Feb 25 (Reuters) - Canadian pension fund Caisse de depot et placement du Quebec said on Wednesday it lost C$39.8 billion ($31.6 billion) in 2008, hit by tumbling stock prices and a depreciating Canadian dollar.
Caisse, one of the country's biggest pension funds, posted a negative return of 25 percent. The median return for large Canadian pension funds in 2008 was negative 18.4 percent.
The Caisse said the C$39.8 billion loss canceled out a portion of the $63.2 billion the Caisse earned in the preceding five years.
From Jan. 1 to Dec. 31, net assets declined to C$120.1 billion from C$155.4 billion.
The Caisse said it changed its asset allocation last October in response to the global financial crisis. It said it increased its liquid assets and reduced its stock market exposure, including selling equities, closing out futures contracts and reducing its foreign exchange hedging.
$1=$1.26 Canadian Reporting by Jennifer Kwan; Editing by Peter Galloway