Thomas P. DiNapoli, the comptroller for the State of New York, announced that the New York State Common Retirement Fund increased to $176.2 billion for the fiscal ending March 31, 2014.
According to him, the current amount reached by the pension fund is the “highest ever.” DiNapoli said the New York State Pension Fund’s rate of return for the period was around 13.03%.
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“It was a stellar year for us. The Fund grew in value to a historic high of $176.2 billion. The strength of the domestic equity market, coupled with strong private equity and real estate returns, drove much of our growth.”
DiNapoli emphasized that the diversified asset allocation of the New York State Pension Fund continued to help generate strong returns. He added, “The financial markets have given investors a wild ride the last few years but our investment strategy has allowed us to capitalize on opportunities and minimize risks.”
Returns of asset classes
According to the New York State Comptroller, its investments in domestic equities generated a return of 22.3%. Its investments in non-U.S. equities brought in 13.2% returns; private equity recorded 17.2% returns; real estate 18.7% returns; global equities 25.1% returns. Its investments in absolute returns strategies and opportunistic alternatives delivered 9.9% and 7.8% rate of return, respectively.
The New State Pension Fund’s investments in core-fixed income recorded -2% returns. Its investments in TIPS declined by -6.2%.
Investment returns funds 80% of benefits
The New York State Pension Fund is the third-largest pension fund in the United States, and it is still one of the best-managed and best-funded pension plans. Over the past 20 years, 80% of benefits for more than one million state and local government employees, retirees, and beneficiaries have been funded from the pension fund’s investment returns.
According to the New York State Comptroller, the New York State Pension Fund is expected to generate a 7.5% rate of return (benchmark) over the long-term. Its expected bench mark rate of return allows it to meets its current and future retirement benefits.
In the prior year, the New York State Pension Fund’ return on investments was a solid 10.38%. Its investments at that time had a market value of $160.7 billion.