This October, as the U.S. stock market fell by -2.16% (as measured by the Russell 3000), the Rhode Island pension system declined by only -1.09%, benefitting from the diversification of the plan's Back to Basics investment strategy and ending the month with $8,680,681,661 in total plan assets. The plan also outperformed a 60% stock / 40% bond benchmark for the month, which would have declined by -1.64%.
Rhode Island's Crisis Protection allocation, made up largely of safe United States Treasury bonds, has been a key contributor to the fund's investment performance and has helped the system remain stable during a time of market volatility spurred by the COVID-19 pandemic. The fund outperformed 87% of comparable U.S. pension plans in the last year, according to Investment Metrics, the leading source of investment performance analytics for institutional investors.
"The 'Back to Basics' investment strategy we adopted in 2016 specifically included a Crisis Protection allocation in order to provide stability for the pension system during times of market volatility," said Treasurer Magaziner. "My office remains committed to supporting a strong and stable Plan despite the economic challenges our nation is currently facing due to COVID-19."
Over the past five years the Rhode Island pension system has outperformed both of its benchmarks, earning an average annual return of 6.90%, as compared to the 6.36% return for the internal plan benchmark and a 60% stock / 40% bond benchmark return of 6.75%.
Detailed information about the fund, including the 'Back to Basics' investment strategy, performance, and detailed information about its managers are published online as part of Treasurer Magaziner's "Transparent Treasury" initiative at investments.treasury.ri.gov.
Note: All performance is reported on a "net of fees" basis.
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Contact: Rosie Hilmer, Director of Communications (401) 222-2240 | (401) 439-2199 (mobile) rosie.hilmer@treasury.ri.gov