Oklahoma Police Pension posts 7.6% return for fiscal year

Oklahoma Police Pension & Retirement System, Oklahoma City, posted a net preliminary return of 7.6% for the fiscal year ended June 30, according to the $3.2 billion pension fund’s latest investment report.

The return falls short of the policy benchmark of 10.9%.

Ginger Sigler, executive director of the pension fund, explained that the fund’s 15% allocation to private equity played a role in the underperformance due to private equity’s “quarter lag in valuations.”

Sigler noted that while the fund missed the benchmark, it surpassed the 7.5% assumed rate of return.

The pension fund also fell short of its policy benchmark on a three-, five- and 10-year basis, earning annualized net returns of 2.1%, 6.8% and 6%, respectively. The benchmark returns for the respective periods were 3.3%, 7.3% and 6.1%.

The pension fund returned a net 2.9% for the fiscal year ended June 30, 2023.

The pension fund’s best-performing asset classes were equities and fixed income, which delivered net returns of 12.3% and 6.5%, respectively. Their respective benchmarks were 19.4% and 3.5%.

Real assets were the poorest performers, returning -8%, above the policy benchmark of -9.4%.

As of June 30, the actual allocation was 19% U.S. large-cap equity, 17% private equity, 11.7% international developed markets equity, 9.9% core real estate, 9.3% U.S. smidcap equity, 8.5% core bonds, 8.3% multisector fixed income, 4.9% emerging markets equity, 4.7% absolute return, 3.3% opportunistic real estate, 2% long/short equity, and the rest in cash and equivalents.

The target allocation is 15% each U.S. large-cap equity, international developed markets equity and private equity; 10% each U.S. smidcap equity, core bonds, multisector fixed income and core real estate; 5% each emerging markets equity, absolute return and opportunistic real estate.