CalPERS, Sacramento, saw its U.S. stocks return 48% in the 12-month period ended March 31, according to a report released by the $140 billion system. The strong results boosted CalPERS' overall return for the year to 29.8%, more than twice the 11% return between March 31, 1996, and March 31, 1997. CalPERS' investment committee attributed the strong showing to an October board decision to increase exposure to equities.
CalPERS, which has more than $96.4 billion invested in the equity markets, said its international equity investments also fared well in the period, returning 20.4%, while its alternative investments returned 32.3%. The system also benefited from currency hedging on its international equity investments for the quarter and the year.
On the down side, fixed-income investments slightly underperformed, because of low interest rates, and earned a 14.6% return, compared with the Salomon Large Pension Fund index, which rose 15.5%. Real estate investments yielded 12% for the period.