9.44% return for fiscal year tops benchmark
Nashville (Tenn.) & Davidson County Metropolitan Government Employee Benefit Trust Fund approved two new commitments totaling $40 million, Chief Investment Officer Fadi BouSamra said in an email.
The $3.2 billion pension fund committed $20 million each to Ares Energy Opportunity Fund, an energy infrastructure fund managed by Ares Management, and Riverstone Credit Partners II, a credit fund managed by Riverstone Holdings.
Both are first-time commitments to these managers, Mr. BouSamra said. Both fall within the pension fund's real assets asset class.
Separately, the pension fund returned a gross 9.44% for the fiscal year ended June 30, above its benchmark of 7.5%. For the three, five and 10 years ended June 30, the pension fund returned a gross 7.96%, 9.46% and 7.17%, respectively, above the respective benchmarks of 6.93%, 7.9% and 6.22%. The pension fund returned a gross 14.9% in the fiscal year ended June 30, 2017.
The best-performing asset class for the most recent fiscal year was domestic equities, at a gross 17.86%, compared to its benchmark of 14.78%. It was followed by private equity, which returned a gross 14.86% (below its 17.57% benchmark); fixed-income alternatives at 10.42% (2.53%); equity hedge, 9.77% (8.3%); real assets, 8.11% (7.2%); international equities, 4.34% (7.28%); and fixed income at 2.89% (-0.4%).
As of June 30, the actual allocation was 20% fixed-income alternatives, 17.5% fixed income, 16.9% private equity, 15.7% domestic equities, 11.7% international equities, 10.8% real assets and 6.2% equity hedge and the rest in cash.