The California State Teachers' Retirement System, the second largest public pension fund in the U.S., fell short of its 7% investment return target in the latest fiscal year, CIO Christopher Ailman said Wednesday.
"We've a little bit underperformed our underlying benchmark," Mr. Ailman said on Bloomberg Television. The fund has yet to release it's earnings for the fiscal year that ended June 30.
"We did OK but not smashingly," Mr. Ailman said. "I expect probably an upper single digit kind of year and looking forward I think the best we can hope for is a single digit year."
CalSTRS, with $350.5 billion in assets, reported a 1.3% loss on its investments in the previous year amid turmoil in the stock and bond markets. In recent years, the fund has turned to private equity and private credit to boost return rates.
Mr. Ailman said private credit is "looking attractive" with corporations continuing to borrow on the private market despite high interest rates. "Loans are very attractive — any kind of loan," said Mr. Ailman, who cautioned investors to conduct due diligence before lending.
