Texas Teacher Retirement System, Austin, returned a net 1.8% vs. 3.3% for its benchmark for the year ended June 30, an investment report presented at the fund's investment committee meeting Wednesday showed.
The net return of the $155.2 billion Austin-based pension fund was 6.4% a year earlier.
Over longer reporting periods ended June 30, annualized net returns were 5.8% for three years (benchmark, 6.2%); 6.3% for five years (benchmark, 6.3%); 8.5% for 10 years (benchmark, 8.4%); and 8.4% since the system's July 1, 1991, inception (benchmark, 7.9%).
The defined benefit plan's broad asset allocation as of June 30 was 54.3% global equity; 21.1% real return; 20.6% stable value; 8% risk parity; 2% cash/asset allocation; and -6% leverage.
Net returns by asset class for the year were led by the stable value portfolio with 16.2% (benchmark, 19.1%) followed by cash/cash equivalents, 1% (benchmark, 1.6%); real return, -0.6% (-0.2%); global equity, -1.7% (-0.5%); private equity, -1.9% (-1.7%); and risk parity, -5.7% (0.3%).
Separately, TRS reported to trustees during the meeting that the system's assets rose 4.8% in the quarter ended June 30 from $149.1 billion as of March 31, driven by $8.1 billion in investment gains less $965 million of withdrawals.