The starting point for, and most important element of, CalPERS successful return on investment is asset allocation - our diversification among stocks, bonds, cash, and other investments.

Asset allocation is not an asset- or liability-only decision. All factors, including liabilities, benefit payments, operating expenses, and employer and member contributions are taken into account in determining the appropriate asset allocation mix. Our goal is to maximize returns at a prudent level of risk, an ever-changing balancing act between market volatility and long-term goals.

We follow a strategic asset allocation policy that identifies the percentage of funds to be invested in each asset class. Policy targets are typically implemented over a period of several years on market declines and through dollar cost averaging.

For more information, see the Board meeting agenda items for Strategic Asset Allocation Alternatives (PDF) and Asset Liability Management Including Actuarial Assumptions and Strategic Asset Allocation (PDF).

Allocation & Market Value by Asset Class as of Febuary 29, 2016
Asset Class Current Allocation Interim Strategic Target* Actual Investment (Billions)
Growth 61.0% 61.0% $170.1
Public Equity 51.3% 51.0% $143.0
Private Equity 9.7% 10.0% $27.1
Income 20.6% 20.0% $57.3
Real Assets 11.3% 12.0% $31.4
Real Estate 9.7% 10.0% $26.9
Forestland 0.8% 1.0% $2.2
Infrastructure 0.8% 1.0% $2.3
Liquidity 1.0% 1.0% $2.9
Inflation 5.0% 6.0% $14.0
Trust Level** 1.1% N/A $3.1
Total Fund 100.0% 100.0% $278.9

* Interim strategic targets adopted by the Investment Committee at the June 2015 Investment Committee meeting
** Trust Level includes: Absolute Return Strategy; Multi-Asset Class; and Overlay, Transition, and Plan Level

Portfolio & Performance

Our investment portfolio is diversified into several asset classes. In the long run, a well-diversified portfolio determines our long-term performance, protects the Retirement Fund, and ensures any weaknesses in one area are offset by gains in another.

CalPERS Public Employees' Retirement Fund (PERF) earned a time-weighted rate of return of 18.4 percent in Fiscal Year 2013-14, with the market value at $301.1 billion. Strong returns in global equity markets and real assets continue to bolster our performance.

Find more information on CalPERS investments in our reports and agenda items.

For Fund status, see: