The New York state pension fund’s total value has reached $160.4 billion after posting a gain of 10.4 percent in FY2013, State Comptroller Thomas DiNapoli said. The pension fund lost over 33 percent of its assets during the 2008 financial crisis. The New York State Common Retirement Fund pays benefits to over 413,000 retirees and their beneficiaries.
Its gain in the year ending March 31 was similar to returns posted by the S&P 500 index in the same period. The retirement fund was valued at $154.5 billion in 2007, before it lost over $44 billion during the 2008 recession. The fund has now restored all of those losses and added another $6 billion.
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DiNapoli said that the retirement fund is well-positioned to enjoy gains as financial markets continue to rise. The next year, FY14-15, will be the last year with greater employer contributions due to recession losses. The New York state pension fund invested 36 percent of its money into domestic stocks which gave a 14.5 percent return last year. About 14 percent was put into international equities, yielding 9.5 percent in gains. Fixed income investments accounting for 28 percent of its portfolio gave a 4.9 percent return. Real estate, where it has invested 7 percent of its money, gave 11 percent return. Private equity, accounting for about 9 percent of its investments, returned over 12 percent last year. The remaining assets were in global equities and alternative investments which returned 13.9 percent.
Increased Average Contribution
After suffering heavy losses during the economic crisis, the retirement fund reduced its assumed rate of return from 8 percent to 7.5 percent. It also increased contribution rates starting 2012. The average contribution rate was 12 percent for most employees and 18 percent for firefighters and police.
The New York state pension fund is one of the country’s best funded retirement plans. However, it’s not the only retirement fund to witness gains. According to the U.S. Census Bureau, the largest 100 pension funds in the United States had $2.9 trillion at the end of the fourth quarter in 2007. It fell to $2 trillion in 2009, but recovered to $2.8 trillion by September 30, 2012. Last month, the California Public Employees’ Retirement System touched $260.8 billion after posting a 13 percent gain in 2012.