PSRS/PEERS Fiscal Year 2017 Investment Return Exceeds Objective; Systems Remain Financially Strong

The Public School and Education Employee Retirement Systems of Missouri (PSRS/PEERS) ended fiscal year 2017 with an investment return of 12.5% (12.3% net of all fees and expenses), exceeding the Systems' investment return assumption of 7.75%. This performance was also better than that achieved by the Systems' investment policy benchmark, which returned 11.0% for the year.

Short-term and long-term annualized investment returns remain above the PSRS/PEERS assumed rate of return.

PSRS/PEERS Investment Returns
Time Span Rate of Return
1-Year 12.5%
5-Year 9.5%
10-Year 5.5%
30-Year 8.4%

The Systems have generated the investment returns while taking less risk than approximately two-thirds of comparable public funds.

"We are pleased with the investment results we were able to achieve during the fiscal year," said PSRS/PEERS Chief Investment Officer, Craig Husting. "However, we remain more focused on the long-term returns than any one year. We continue to achieve solid investment returns while maintaining competitive fees. Both are equally important parts of managing the portfolio in a responsible manner for our members."

The consistent investment returns, along with prudent management and a well-developed funding strategy, have helped both PSRS and PEERS maintain a healthy funding status. As of June 30, 2016, PSRS was 84.8% pre-funded, and PEERS was 86.4% pre-funded. The pre-funded status of a retirement system is the plan's ability to pay current benefit promises with today's dollars. The Systems' external actuary will present the 2017 pre-funded statuses at the November 3, 2017 Board Meeting. It is expected that the pre-funded statuses for both PSRS and PEERS will remain stable.

The market value of invested assets for PSRS/PEERS combined were approximately $41.5 billion on June 30, 2017, making the joint entity larger than all other public retirement plans in Missouri combined, and the 43rd largest defined benefit pension plan in the United States.