PSERS has put a bigger share of its money into “alternative” investments than any other public pension fund.
Such investments – hedge fund start-ups, private-equity buyouts – make up more than half its $67 billon portfolio. Other retirement plans invest more heavily in conventional stocks and bonds.
The Pennsylvania fund’s profit rate in recent years has trailed the Standard & Poor’s 500 U.S. stock index. PSERS has put billions into such high-fee Wall Street financial products as “risk parity” funds and special energy partnerships. The retirement plan also keeps a separate index for such investments in general, as a way to track its particular funds.
In both cases, the PSERS investments have generally lagged behind its index.
| PSERS actual returns, entire plan | |
| 1-year | 1.1% |
| 3-year average | 5.6% |
| 5-year average | 5.6% |
| 10-year average | 7.7% |
| S&P index | |
| 1-year | 9.2% |
| 3-year average | 11.4% |
| 5-year average | 11.1% |
| 10-year average | 13.7% |
| PSERS energy partnerships | |
| 1-year | −35.4% |
| 3-year average | −13.0% |
| 5-year average | −11.1% |
| 10-year average | 3.5% |
| Comparative index | |
| 1-year | −31.0% |
| 3-year average | −11.2% |
| 5-year average | −10.1% |
| 10-year average | 1.0% |
| PSERS “risk parity” funds | |
| 1-year | 0.1% |
| 3-year average | 5.0% |
| 5-year average | 4.4% |
| 10-year average | N/A |
| Comparative index | |
| 1-year | 10.5% |
| 3-year average | 8.7% |
| 5-year average | 7.4% |
| 10-year average | 8.8% |
| 1-year | 3-year average | 5-year average | 10-year average | |
|---|---|---|---|---|
| PSERS actual returns, entire plan | 1.1% | 5.6% | 5.6% | 7.7% |
| S&P index | 9.2% | 11.4% | 11.1% | 13.7% |
| PSERS energy partnerships | −35.4% | −13.0% | −11.1% | 3.5% |
| Comparative index | −31.0% | −11.2% | −10.1% | 1.0% |
| PSERS “risk parity” funds | 0.1% | 5.0% | 4.4% | N/A |
| Comparative index | 10.5% | 8.7% | 7.4% | 8.8% |
