CalSTRS on Monday said its investment portfolio returned 12.3% for its fiscal year ended June 30, underperforming the 14.7% return of its policy benchmark, according to Ricardo Duran, spokesman.
The performance raised the assets of the California State Teachers’ Retirement System, West Sacramento, to $129.77 billion as of June 30.
The return surpassed CalSTRS’ 8% assumed actuarial return rate.
CalSTRS reported double-digit positive returns in all but one major asset class — real estate, which lost 12.4%. The system returned 14.5% in global equities, made up of 15.7% in domestic equities and 12.1% in international equities; 12.3% in fixed income; and 21.7% in private equity, according to a CalSTRS statement.
By contrast, its customized benchmarks were 15.71% in U.S. equities, 10.3% each in non-U.S. equities and fixed income, 56.68% in private equity and -9.6% in real estate.
“Our performance did not beat our benchmarks, but the CalSTRS investment staff and the board have made the necessary moves to position the fund for continued improvement,” Mr. Duran said.
As of June 30, CalSTRS’ allocation was 51.7% U.S. and non-U.S. equities, 22% fixed income, 14.5% private equity, 10.1% real estate, 0.9% absolute return and 0.8% cash, the statement said.
Its five-year strategic asset allocation targets are 47% U.S. and non-U.S. equities; 20% fixed income; 15% real estate; 12% private equity; 5% absolute-return strategy for inflation protection, including hedge funds, infrastructure and commodities; and 1% cash, said Mr. Duran.