Oregon Public Employees Pension Fund posts 6.3% return on private equity strength

The pension plan has an assumed rate of return of 6.9%. OPERF’s board of directors is expected to review its assumed rate of return next summer.

The best performing asset class in the current year was real estate with a net return of 29.6%, above its benchmark index of 27.2%; followed by private equity at 24% (15.2% benchmark); real assets, 23% (13.1%); diversification strategies, 17.1% (0.1%); portfolio of opportunities, 10% (14.5%); cash, -0.8% (0.2%); fixed income, -9.1% (-10.1%); risk parity, -13% (-6.7%); and public equities, -13.3% (-16.5%).

Paola Nealon, managing director of the board’s general investment consultant, Meketa Investment Group, told the board on Wednesday that one of the reasons for the pension fund’s “very good numbers” for the year was due to its 8 point overweight. percentage in the private sector. equity.

As of June 30, OPERF had an actual allocation of 28% private equity, 21.9% public capital, 16.6% fixed-income securities, 13.6% real estate, 7.9% real estate assets, 4.9% diversification assets, 2.6% opportunity portfolio, 2.5% cash and 2% risk parity.

The pension plan’s target allocation is 30% public equity, 20% private equity, 20% fixed income, 12.5% ​​real estate, 7.5% real assets, 7 .5% diversification strategies, 2.5% risk parity and zero against the portfolio of opportunities and cash.

Allan Emkin, also managing director of Meketa, noted that the outperformance was due to “big bets” that hadn’t paid off in a long time and paid off.

“We don’t know if they’ll charge in the future,” Emkin said.

Additionally, the board is in the midst of an asset-liability study, and the board is expected to review recommended alternative portfolios in October.

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