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2 San Jose funds see fiscal-year returns above 26%

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Two San Jose, Calif., pension funds reported fiscal-year returns that each exceeded 26% in investment reports posted on the pension funds’ website.

The $2.8 billion San Jose Federated City Employees Retirement System, returned a net 29.2% for the fiscal year ended June 30, above its policy benchmark return of 27.8%.

For the three, five and 10 years ended June 30, the pension fund returned an annualized net 11.8%, 9.7% and 6.4%, respectively, compared with their respective benchmarks of 11.3%, 9.9% and 6.9%.

The federated employees pension fund returned a net 3.6% for the fiscal year ended June 30, 2020.

The $4.7 billion San Jose Police & Fire Department Retirement Plan returned a net 26.3% for the fiscal year ended June 30, above its policy benchmark return of 25.2%.

For the three, five and 10 years ended June 30, the pension fund returned an annualized net 10.7%, 9.7% and 6.9%, respectively, compared with their respective benchmarks of 10.4%, 9.7% and 7.1%.

The police and fire pension fund returned a net 3.1% for the fiscal year ended June 30, 2020.

For the most recent fiscal year, both pension funds’ best-performing asset class was emerging markets equities. The police and fire plan and federated employees’ plan returned a net 47.4% and 46.7, respectively, for the year ended June 30, above their common benchmark return of 43.2%.

The next-highest performing asset class was domestic equities. The federated plan returned a net 45.1%, and the police and fire plan returned a net 45% for the asset class, above the common benchmark of 43.8%.

As of June 30, the Federated City Employees Retirement System’s actual allocation was 49.5% public equities; 22.8% private markets; 7.2% investment-grade fixed income; 4.4% core real estate; 3.6% immunized cash flows; 3.1% market-neutral strategies; 2.8% emerging markets debt; 2% long-term government bonds; 1.9% each high-yield bonds and Treasury inflation-protected securities; 0.5% cash and the rest in overlay.

Also as of June 30, the Police & Fire Department Retirement Plan’s actual allocation was 46.7% public equities; 18% private markets; 11.2% investment-grade fixed income; 4.4% core real estate; 3.9% immunized cash flows; 3.1% market-neutral strategies; 2.9% long-term government bonds; 2% each commodities and emerging markets debt; 1.9% each high-yield bonds and TIPS; 1.3% cash; and the rest in overlay.