Massachusetts State Pension Fund Ekes Out Small GainCategories: New England Developments,Pension Rate Stabilization
The Boston Globe by Beth Healy January 20, 2016
The Massachusetts state pension fund is expected to post a 2015 investment return of just over 1 percent, executive director Michael Trotsky said Tuesday.
The $60 billion fund for public workers and teachers eked out a positive return in a year when large stock and bond indexes lost value. By comparison, a portfolio made up of 60 percent global stocks and 40 percent bonds was down 1.2 percent for the year ended Dec. 31.
“It’s nothing to brag about,’’ Trotsky said in an interview. But, “it’s better than losing money.”
Trotsky said the fund’s trimming of its stock portfolio, from 49 percent five years ago to 40 percent now, helped stave off greater losses.
The fund also has increased its holdings in long-duration Treasury bonds and has done well in alternative investments such as private equity, he said.
“We’ve been preparing for a downturn in stocks,” after a long bull market, he said. The fund gained 8.2 percent in value in 2014.
Trotsky disclosed the return estimate Tuesday at the investment committee meeting of the Pension Reserves Investment Management board. The final 2015 returns, with details, will be released in the coming days.
The pension fund’s fiscal year runs July 1 to June 30, but it also makes its results over the calendar year public.