Defined Benefit Plans Returned 4.47% in the First Quarter

Strong equities boosted returns for asset owners in the first quarter of 2024.



Asset owners had strong Q1 2024 returns, primarily boosted by equities, according to Confluence’s investment metric plan universe report. The investment metrics plan universe is an analytical tool which sources data from 4,000 asset managers and asset owners.

Confluence is a technology solutions company, which provides services such as data-driven analytics to compliance and regulatory solutions for firms in the investment management industry. 

According to Confluence, its tracker of the defined benefit plan universe returned 4.47% in the first quarter. Of the asset owners in this tracker, endowments and foundations outperformed a 60/40 portfolio, which returned 4.63%.

Endowments and foundations were the highest returning of all the types of asset owners in the plan universe; these institutions returned roughly 5% in the first quarter and a median 14.54% for the year ended March 2024. 

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In the first quarter, corporate DB plans had the highest returns, at just under 8%. Public DB plans returned roughly 5%, Taft Hartley plans returned just over 5%, and health and welfare plans returned just over 2%

For the one-year period ending March 31, corporate DB plans returned roughly 8%, public DB plans returned just over 14%, Taft Hartley plans returned nearly 12%, and health and welfare plans returned just over 8%. 

Equities were the primary driver of investments in the first quarter, the asset class returned just under 10% in the first quarter and 23.18% in the one-year period ending March 31. Returns for alternatives were flat in Q1 but brought in 7.39% over the past year. Real estate was the only asset class with negative returns, with slight negative returns in the first quarter and down 10% return over the past one-year period. 

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Irony: BlackRock, Shunned by U.S. Energy-Producing States, Teams Up With Oil-Rich Saudi Arabia

The kingdom, one of the top producers of carbon-based fuel, and the asset management kingpin form an investment partnership.



BlackRock Inc., cast out by as many as 17 red states, many of them oil producers, is joining forces with the ultimate petro-state, Saudi Arabia. The world’s largest asset manager ($10.5 trillion under management) has formed an investment partnership with the kingdom’s sovereign wealth pool, the Public Investment Fund.

BlackRock Riyadh Investment Management, funded with an initial $5 billion commitment from the PIF, is aimed at helping Saudi Arabia move beyond its long-time focus on fossil fuels. Saudi leaders are planning a major shift into technology, tourism, manufacturing and renewable energy, an effort it calls Vision 2030.

The irony here is that BlackRock incurred the ire of Republican officeholders in Texas, Oklahoma, Kentucky and West Virginia, along with other GOP-led states, because of BlackRock CEO Larry Fink’s advocacy for using environmental, social and governance precepts in investing.

The states withdrew more than $13 billion in investments from BlackRock, in retaliation for what their officials termed its boycott of energy companies. Fink argued that BlackRock still invests in fossil fuel companies, but the officials brushed that aside.

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To be sure, the Saudi leadership has none of the qualms about ESG that some U.S. politicians do—witness its embrace of renewable energy as part of its future. Still, the kingdom acknowledges that fossil fuels will remain a key part of its economy for a long time.

At a March conference in Houston, Amin Nasser, the CEO of Saudi Aramco, its oil company, said the world should “abandon the fantasy” that demand for oil and gas will peak in 2030, as many environmentally oriented policymakers believe.

The BlackRock-Saudi partnership intends to invest in public equities, bonds, private credit and infrastructure in Saudi Arabia and other nations in the Middle East and North Africa. The enterprise also seeks to enhance the education of investment professionals there. BlackRock will manage the project and use the firm’s worldwide reach to find investment targets.

“To transform the economy, Saudi Arabia will need to draw in outside financing, which creates significant investment opportunities,” BlackRock’s Fink wrote in a LinkedIn post. Estimates of the total cost of the shift of the Saudi economy are above $3 trillion. In March, Saudi Arabia transferred an 8% stake in Aramco (worth $168 billion) to the PIF, in aid of the effort.

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