Indiana returns 7.3% for fiscal year

Indiana Public Retirement System's $42.3 billion defined benefit plan posted a preliminary net return of 7.3% for the fiscal year ended June 30, slightly above its benchmark.

The pension plan's return finished above the 6.9% net return of its passive asset allocation benchmark, which includes exposure via derivatives that provides more market exposure, the Indianapolis-based retirement system disclosed in an investment report included with materials for its Sept. 6 board meeting.

For the three, five and 10 years ended June 30, the pension plan returned an annualized net 0.9%, 5.7% and 5.4%, respectively, above their respective passive asset allocation benchmarks of 0.8%, 5.5% and 5.1%.

The INPRS pension plan returned a net 2.2% for the fiscal year ended June 30, 2023.

For the most recent fiscal year, the pension fund’s return was short of the median return of 9.8% among the 54 U.S. public pension funds whose fiscal-year returns have been tracked by Pensions & Investments as of Sept. 6.

By asset class, the pension plan’s top performer was public equities, which returned a net 17.3% for the fiscal year ended June 30 (just short of its benchmark return of 17.5%), followed by commodities with a net return of 9.52% (above its 6.9% benchmark); risk parity, 8% (benchmark 12.7%); absolute return, 7% (7.6%); private markets, 3.8% (19.6%); fixed income (ex-inflation linked), 0.8% (0.8%); fixed income (inflation linked), 0.7% (0.5%); and real assets, -0.9% (6.7%).

As of June 30, the pension plan’s actual allocation was 21.6% risk parity, 18.6% public equities, 16.3% private markets, 16.1% fixed income (ex-inflation linked), 13.6% (inflation linked), 9.3% real assets, 8.6% commodities, 6.5% absolute return, and 1.6% cash and overlay. The total exceeds 100% due to the inclusion of derivative overlays.