Institutional investors recorded positive returns for the third quarter in a row for the three-month period ended June 30 despite continuing economic uncertainty, data from Wilshire Advisors showed.
Plans in the Wilshire Trust Universe Comparison Service posted median returns of 2.7% and 8.1%, respectively, for the first quarter and year ended June 30, respectively.
While the second quarter was the third positive quarter in a row for Wilshire TUCS investors, the median return fell short of the strong median returns of 4.1% and 5.6% for the first quarter of 2023 and fourth quarter of 2022, respectively.
"Global economic growth forecasts have become increasingly uncertain, particularly in the United States, where investors are beginning to question the once certain probability of a recession in 2023," said Jason Schwarz, president and deputy CEO of Wilshire Advisors, in a news release Thursday. "All plan types underperformed a traditional 60/40 portfolio, while smaller plans with higher allocations to public markets outperformed larger plans by approximately 50 basis points."
According to Wilshire data, the traditional 60% stocks/40% bonds portfolio returned 9.4% for the year ended June 30. Second-quarter data was not provided.
Across all plan types, small endowments and foundations (with less than $500 million in assets) had the strongest median return for the quarter ended June 30 at 3.2%, while large corporate pension plans (with more than $1 billion) had the lowest median return at 1.1%.
For the year ended June 30, small public pension plans (with assets below $1 billion) had the highest median return at 10%, while large corporate pension plans had the lowest at 3.85%.
By asset class, the Wilshire 5000 Total Market index returned 8.4% and 19% for the quarter and year ended June 30, respectively, and the MSCI ACWI ex-U.S. index posted respective quarterly and one-year returns of 2.4% and 12.7%. The Wilshire Bond index, meanwhile, returned a median -0.7% and zero for quarter and year ended June 30, respectively.
