Oregon PERF to Grow Infrastructure Portfolio

The $77 billion Oregon Public Employees Retirement Fund will be investing in five infrastructure strategies this year, according to a board meeting report.

The fund will grow the infrastructure portion of its portfolio from $1.3 billion to $2.4 billion. Oregon PERF will be seeking global strategies made to boost telecommunications and infrastructure debt.

This move will partially form the fund’s plan to invest $3 billion in alternative investments this year. The plans also include US timberland and farmland investments, which will be made through funds, separate accounts, and co-investments. This decision was made to provide a hedge against inflation, with returns expected to be at least 400 basis points above the consumer price index.

The state pension plan also seeks to grow the eight managers it invests with to between 10 and 12 over time, IPE reports.

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Tags: Infrastructure, Oregon Public Employees Retirement Fund (PERF), Pension

Canadian pension plans reported their eighth consecutive quarter of positive gains, with a median return of 0.37% for the first quarter of 2018, despite domestic equities falling nearly 3% during that same time frame, according to CIBC Mellon.

The BNY Mellon Canadian Master Trust Universe, which is comprised of 85 Canadian corporate, public, and university pension plans, also reported a one-year return of 6.88%, which is comparable to its 10-year annualized return of 6.99%. The funds also reported three- and five-year annualized returns of 5.72%, and 9.15%, respectively.

The combined funds have a market value of more than C$242.3 billion ($188.6 billion), with an average plan size of C$2.8 billion. Approximately 65% of the plans posted positive results for the quarter.

“The top-performing asset classes in the first quarter were US equities and non-Canadian equities with a median return of 2.38% and 2.37%, respectively,” said Catherine Thrasher, a managing director at BNY Mellon Asset Servicing, in a release.

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International equities were the best-performing assets over the one-year time horizon, surging 13.05%, while the weakest-performing asset class during the quarter was Canadian equities, which posted a median loss of 2.98%. Despite the down quarter for the Canadian equity asset class, it still outperformed the S&P/TSX Composite Index, which lost 4.52% for the quarter.

Canadian universities posted a quarterly median return of 0.26%, and a one-year median return of 6.72%, while Canadian foundations and endowments posted a negative median return of 0.07% for the quarter, and a 6.04% gain over the one-year time period.

Meanwhile, the median quarterly return for the US equities asset class was 2.38%, which beat the S&P 500 Index’s return of 2.12%. And international equity and non-Canadian equity, which saw median returns of 2.35% and 2.37%, respectively, were ahead of the MSCI EAFE Index and MSCI World Index returns of 1.44% and 1.71%.

Fixed income investments remained relatively flat, edging 0.18% higher during the quarter, which outperformed the FTSE TMX Canada Bond Universe Index return of 0.10%. And alternative asset classes were led by infrastructure, which saw a median return of 5.49%, followed by private equity, hedge funds, and real estate, which rose 5.10%, 3.37%, and 1.94%, respectively.

Tags: BNY Mellon Canadian Master Trust Universe, Canada, Equities, Pension