The California State Teachers’ Retirement System (CalSTRS) reported an investment return of 4.8% in its latest fiscal year, which was below its actuarially assumed 7.5% rate of return because of volatile market equity markets.
It was the first time results were below the assumed rate of return since fiscal year 2011-12.
Over the long term, the rates of return have been much better: 12.1% over five years and 7.8% over 20 years.
“It’s important to keep in mind that our investment horizon is 30 years and that any single year’s over or underperformance will not make or break us,” says CalSTRS chief investment officer Christopher J. Ailman. “The six-year bull market is admittedly long in the tooth and since the majority of our assets are in stocks, our portfolio will reflect that larger reality.”
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