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Asset allocation is a process of investing across many different asset classes with the purpose of diversifying the risk of the IPERS investment portfolio.
The Investment Board establishes a policy benchmark that is a strategic set of target allocations for each asset class. IPERS’ investment staff strives to meet or beat the return on the policy benchmark by conserving investment management costs and prudently deploying investment risk across asset classes and strategies.
Asset Allocation Targets
The long-term target allocations listed below are shown as the percentage of the total fund.
- Domestic Equity: 21%
- International Equity: 13%
- Global Smart Beta Equity: 5%
- Core Fixed Income: 25.5%
- Public Credit: 3%
- Cash: 1%
- Private Equity: 17%
- Private Credit: 5.5%
- Private Real Assets: 9%
Allocation Definitions:
Domestic Equity: Investment in stocks of companies based in the United States.
International Equity: Investment in stocks of companies based outside the United States.
Global Smart Beta Equity: Investment in stocks of companies located across the world, but with the objective of capturing factor exposures using a systematic, rules-based approach.
Core Fixed Income: Investment in bonds issued by governments and companies throughout the world.
Public Credit: Investment in high-yield bonds issued by North American companies, and bonds issued by governments and companies located in emerging, less-developed countries.
Cash: Investment in highly liquid, stable-value securities, such as money market instruments or funds.
Private Equity: Investment in the stock and debt of privately held companies. These investments are held in limited partnerships designed to limit IPERS’ potential losses.
Private Credit: Investment in partnerships that make loans to private middle-market companies and partnerships that make loans to finance commercial real estate.
Private Real Assets: Investment in commercial real estate located in the United States, and partnerships that invest in timberland and farmland in North America.