Pennsylvania PSERS Reports 2.95% Return in Q1

The Pennsylvania Public School Employees’ Retirement System announced Monday it achieved a 2.95% return in the year’s first quarter, as well as an 8.10% return for the one-year period ending March 31.

Pennsylvania PSERS CIO Ben Cotton noted in a statement that the fund’s preliminary one-year return was slightly more than 8%. Over the past three, five, 10, 15 and 20 years, PSERS has reported annualized returns of 6.59%, 4.94%, 7.10%, 9.07% and 7%, respectively, for annual periods ending March 31.

The Pennsylvania PSERS portfolio is 62.9% public market assets and 36.7% private market assets. Public equities comprise of 27.2% of the pension fund’s assets, with public fixed income making up another 22.7%. The fund allocates 16.5% to private equity, 12.8% to public real assets, 10.9% to private real assets, 7.4% to private fixed income, 1.9% to absolute return strategies, 0.4% to tail risk mitigation strategies and 0.3% to cash.

For the quarter, public equities returned 8.41%, boosted by U.S. equities, which returned 10.31%, while non-U.S. equities returned 6.38%. Private equity returned 2.12% on a one-quarter lag. Public fixed income returned negative 0.64%. Only credit-related fixed-income assets had positive returns. In its public fixed-income portfolio, credit-related assets returned 3.59%, while PSERS’ private credit portfolio returned 1.8%.

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Pennsylvania PSERS’ real assets portfolio returned 1.67% in the quarter, of which public real assets returned 3.16% and public real estate returned negative 0.19%. Public infrastructure returned 2.49%, and public commodities returned 5.19%. Private real assets lost 0.02%. Within private real assets, the fund’s private real estate composite allocation lost 1.53%, while private infrastructure returned 2.8%, and private commodities returned 0.5% in the first quarter.

The pension fund saw its assets increase by $2.3 billion to $74.6 billion by the end of the first quarter. Pennsylvania PSERS has more than 500,000 beneficiaries, consisting of 251,000 active members, 250,000 retired school employees and 27,000 vested inactive members.