via Wall Street Journal
The largest U.S. public pension posted its lowest annual gain since the last financial crisis due to heavy losses in stocks. The California Public Employees’ Retirement System, or Calpers, said it earned 0.6% on its investments for the fiscal year ended June 30, according to a Monday news release.
It was the second straight year Calpers failed to hit its internal investment target of 7.5%. Workers or local governments often must contribute more when pension funds fail to generate expected returns. Calpers oversees retirement benefits for 1.7 million public-sector workers.
Calpers’ annual results are watched closely in the investment world. It is considered a bellwether for U.S. public pensions because of its size and investment approach. Many pensions currently are struggling because of a sustained period of low interest rates.
“This is a challenging time to invest,” Ted Eliopoulos, Calpers’ chief investment officer, said in the release. The last time Calpers lost money was during fiscal 2009 when the fund’s holdings fell 24.8%.