US - The US$29bn Pennsylvania State Employees' Retirement System (SERS) earned $3.8bn in 2005, placing it in the top 5% of public pension funds nationally.
That translated into a 14.9% return for the year, comfortably higher than 7.55% median return for public pension funds in 2005m according to the Trust Universe Comparison Service® (TUCS) report released earlier by Wilshire Associates.
“This places SERS among the top 5% of public pension funds nationally in 2005 performance, while its 10-year compounded return ranks SERS among the top quarter of all funds,” said SERS Chief Investment Officer Peter Gilbert.
The two top performing asset classes for SERS were private equity (36.5%) and real estate (30.9%). Gilbert noted that investors who were confined to a traditional large-cap stock portfolio saw low returns last year - with dividends, the S&P 500 was up just 4.9% and the Dow Jones Industrial Average ended the year up just 1.7%.
The performance builds on strong returns from 2004 (15.1%), said SERS Board Chairman Nicholas Maiale. “Over the past decade, and despite the historic bear market, SERS’ net compounded returns have been in excess of 10% per year.” Gilbert credited the system’s success to its strategy of broad diversification across asset classes globally, including non-traditional asset classes.
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