Texas Municipal's returns top benchmarks for year and more

Texas Municipal Retirement System's preliminary net returns were above the pension fund's benchmark for reporting periods ended June 30, an investment report showed.

For the year ended June 30, the preliminary net return for the $30 billion Austin-based retirement system was 5.4% compared with 5.3% for the benchmark. Preliminary net annualized returns for longer periods were 7.9% for three years (benchmark, 7.5%); five years, 5.4% (5.2%); seven years, 6.8% (6.6%); 10 years, 7.1% (6.8%); and 15 years, 6.9% (6.3%).

TMRS returned 7.5% for the year ended June 30, 2018. The pension fund's fiscal year ends Dec. 31.

By asset class, private equity was the best performer over the year ended June 30, with both investments and the benchmark returning a net 17.5%, followed by the 9.1% preliminary net return of the pension fund's real estate portfolio (benchmark, 7.5%); core fixed income, 8.1% (7.9%); real return, 5.5% (5.3%); non-core fixed income, 5.5% (5.2%); equity, 4.1% (4.8%); absolute return, 2.3% (0.1%); and cash, 2.2% (2.3%).

The one-year return of the pension fund's real estate portfolio lags by one quarter.

The pension fund's asset allocation as of June 30 was 36% equities, 18% non-core fixed income, 14% core fixed income, 11% real return, 9% real estate, 8% absolute return, 2% private equity and 2% cash.