New York Common Shows Moderate Gains

Pension System: The New York State Common Retirement Fund

Assets Managed: $150.3 Billion (March 31, 2011)

Private Equity Assets: $14.4 Billion (March 31, 2011)

Private Equity Allocation: 9.6% (March 31, 2011)

Target PE Allocation: 10%

Chief Investment Officer: Marjorie Tsang (Interim)

The New York State Common Retirement Fund, the nation’s third-largest pension, saw its assets grow 6 percent to $150.3 billion in the 2011-2012 fiscal year, which ended on March 31. The fund’s performance was slightly better than that of the S&P 500, which returned 5.7 percent during the same 12-month period.

Private equity, which returned 8.3 percent, was the third-best performing asset class for the fund. According to Thomas DiNapoli, the state comptroller who oversees the fund, private equity, which includes venture capital, now amounts to 9.6 percent, or $14.4 billion, of the pension’s overall portfolio.

The pension’s two best performing assets were real estate, which returned 17.6 percent, and fixed income, which returned 9 percent. Other asset classes included domestic equities (which gained 6.9 percent), non-U.S. equities (which lost 6.4 percent), global equities (which lost 0.5 percent), absolute return strategies (which lost 2.4 percent), and opportunistic alternatives (which gained 1.2 percent).

The pension was now at its highest level of funding since the financial crisis began, having reached a peak of $154 billion in 2008. In a statement, DiNapoli said, “The financial markets took investors on an up and down ride last year, but the … fund’s diversified investment portfolio coupled with a long term view have helped us weather these large swings.”

New York Common has one of the highest funding levels in the nation. As of fiscal year 2009, the state was able to meet 101 percent of its future obligations, according to the Pew Center on the States.

The pension is unusual in that its fiscal year ends in March, whereas most pensions close their books on June 30. The difference makes it more difficult to compare its results with those of other pensions across the United States.

The New York Common fund manages retirement benefits for more than a million New York public employees and retirees.