The latest fiscal year's improved performance likely benefited from stronger market returns for the period in both equities and fixed income. For the year ended June 30, the Russell 3000 and Bloomberg U.S. Aggregate Bond index returned 19% and -0.2%, respectively, well above their respective returns of -13.9% and -10.3% for the year ended June 30, 2022.
Of the 48 public pension funds whose fiscal-year returns have been tracked by Pensions & Investments as of Wednesday, the median return for the period was 7.6%.
For the most recent fiscal year, LACERA's top-performing asset class was its growth asset class, which returned a net 10.2% for the fiscal year ended June 30 (above the benchmark return of 8%); followed by credit at a net 7.7% (6% benchmark); real assets and inflation hedges, 0.1% (-0.6%); and risk reduction and mitigation, -0.2% (zero).
As of June 30, the actual allocation was 53.2% growth, 18.6% risk reduction and mitigation, 16.4% real assets and inflation hedges, 11.3% credit, and 0.5% overlays and hedges.
The target allocation is 53% growth, 19% risk reduction and mitigation, 17% real assets and inflation hedges, and 11% credit.