RICHMOND, August 15, 2017 — The Virginia Retirement System (VRS) achieved a 12.1 percent return, net of fees, on its investment portfolio for fiscal year 2017, exceeding both the 11.8 percent policy benchmark set by the VRS Board of Trustees and the 7 percent assumed rate of return. The trust fund ended the year with approximately $74 billion in assets, a historic high for the fund.
"In fiscal year 2017, most markets delivered robust returns," said Chief Investment Officer Ronald D. Schmitz. "However, we know market environments vary from year to year, and we will see returns above and below the 7 percent assumed rate of return. As a long-term investor, VRS focuses more closely on returns over 10-, 20- and 25-year periods and has exceeded the policy benchmarks for those periods, ending June 30, 2017."
During fiscal year 2017, the major asset classes performed as follows:
- Private equity program returned 20.6 percent
- Public equity program returned 17.7 percent
- Real assets program returned 10.8 percent
- Credit strategies program returned 10.1 percent
- Strategic opportunities portfolio returned 8.2 percent
- Fixed income program returned 0.5 percent
The portfolio included approximately $30.7 billion in public equity, $13.1 billion in credit strategies, $12.4 billion in fixed income, $9.4 billion in real assets, $6.5 billion in private equity and $1.8 billion in the strategic opportunities portfolio, as of June 30, 2017.
"A strong market environment and positive relative performance helped VRS investment staff generate a very meaningful return toward the growth of the fund," said VRS Board Chairman Mitchell L. Nason. "With approximately two-thirds of the retirement benefit being funded through investment returns, this double-digit return for fiscal year 2017 helps ensure the health of the fund over the long-term and provides members confidence in their future retirement benefits."