Investors - JULY 12, 2018

CalPERS reports preliminary 8.6% investment return for FY 2017–2018

by Jody Barhanovich

The California Public Employees’ Retirement System has reported a preliminary 8.6 percent net return on investments for the 12-month period that ended June 30, 2018. CalPERS’ assets at the end of the fiscal year stood at more than $351 billion.

Strong returns came from the private equity program, which generated a 16.1 percent return, followed by public equity preliminary net returns of 11.5 percent. Real assets returned 8.0 percent, which included a 20.6 percent return from the infrastructure program.

Based on these preliminary fiscal year returns, the funded status of the overall CalPERS fund is an estimated 71 percent, an increase of 3 percentage points from the previous fiscal year. This estimate is based on a 7 percent discount rate.

Additional returns include fixed income, which earned 0.4 percent, while inflation assets returned 9.3 percent for the fiscal year.

This brings total fund performance to 8.1 percent for the five-year time period, 5.6 percent for the 10-year time period, and 6.1 percent for the 20-year time period. Over the past 30 years, the CalPERS fund has returned an average of 8.4 percent annually.

CalPERS’ asset class performance is as follows:

Net Rate of Return Performance Relative to Policy Benchmarks
Total Fund 8.6% (6) bps
Public Equity 11.5% (42) bps
Private Equity 16.1% (250) bps
Fixed Income 0.4% 38 bps
Real Assets 8.0% 119 bps
Real Estate 6.8% (26) bps
Infrastructure 20.6% 1,416 bps
Forestland 1.9% (187) bps
Inflation Assets 9.3% 37 bps
Liquidity 1.7% 37 bps


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