Public pension plans that are well-funded share some common characteristics, according to the National Association of State Retirement Administrators (NASRA). And since LAGERS ranks in the top ten in terms of funding among U.S. plans, you may guess that these characteristics would be found in our practices. And you would be right.
LAGERS’ Investment Team describes the portfolio allocation process as being similar to building a house. We want to build a house that will withstand all types of weather, one that will protect our loved ones against anything that the current or future environment could throw our way. We seek to accomplish this same goal in portfolio construction, using diversification of assets, liquidity, and careful monitoring of exposures to ensure we’re not dependent on any one market environment to succeed. The last six months of 2018 saw the “weather” in the global market change drastically from the last nine years since the crisis. Due to the portfolio adjustments of the last few years, resulting in the current allocation, the house was only minimally impacted by this current storm.
Recently I asked Brian Collett, our CIO, to give me an update on our most recent investment numbers. He shared lots of information with me on our most recent numbers, but also talked about our Asset study that we just completed, and how that shapes our investment strategy.
Tagged Investment Return, Investments, Contribution Rates, Investments; Return; LAGERS Portfolio, Pension Health, LAGERS performance, Quarterly Update, Retirement, Retire, inflation, stock market, equities, Brian Collett, Sound Funding, Asset Study
Interview re-printed with permission from Trusted Insight.Brian Collett is the chief investment officer of Missouri Local Government Employees Retirement System (MOLAGERS), a $7.5 billion system. Under his leadership, Missouri LAGERS performed among the top in the public fund universe, returning 9.45 percent annualized net of fees for the last five years.
To many, the market turmoil that hit stocks globally last week came out of nowhere. In the US, after almost two years of the stock market grinding its way higher, seemingly in defiance of gravity, the over 5% fall last week reminded us that what goes up must come down. In truth, we’ve been living in an investing world which isn’t normal. Falls in the market like the one experienced this February however, are entirely normal, and often healthy, for markets to experience.