Following a 15-month period of growth, global stock markets posted a 4.07 percent loss in the month of February. During this volatility, the Back to Basics investment strategy brought stability to Rhode Island's pension fund, resulting in a -2.64 percent return on the month, outperforming the global stock market as well as a traditional 60% stock/40% bonds portfolio, which would have returned -2.90 percent.
"Recently, the stock market has seen steady, historic growth, which has allowed Rhode Island's pension fund to grow stronger and healthier than it has been in decades," said Treasurer Magaziner. "Our 'Back to Basics' investment strategy is designed to deliver growth when markets are strong and stability when they are down. While I would prefer to see markets grow every month, Back to Basics did its job and limited the impact of February's market correction."
Components of the Back to Basics strategy designed to bring stability to the system held the line as global markets dropped in February, with the Volatility Protection portion of the pension portfolio returning a steady -0.02 percent and Inflation Protection assets gaining 0.29 percent.
In the 12-month period ending February 28, 2018, the fund returned 11.24 percent and ended with a market value of $8.39 billion. The fund remains ahead of both its internal benchmark which returned 11.22 percent and a 60/40 portfolio which would have returned 11.20 percent over that time.
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Contact: Evan England, Director of Communications (401) 222-2240 | (401) 439-2199 (mobile) email@example.com