The Maryland State Retirement and Pension System, responsible for investing money and administering the retirement and pension allowances for 168,000 state employees and beneficiaries, has not missed out on Wall Street’s historic stock market rallies in the past year, logging record returns on its investments for fiscal 2021.
Its portfolio returned 26.7%, net of fees, on its investments. Fiscal 2021 ended June 30. That is well above the pension fund’s assumed annual return rate of 7.4%.
The S&P 500 Index had a 12-month return during the state’s same fiscal 2021 period of 43%. The 26.7% return for Maryland’s pension fund came even as its maintained its moderate risk posture for its investments.
The fund’s performance over 10-year, five-year and three-year periods are all above the 7.4% return assumption at 8.2%, 10.7% and 11.8%, respectively.
About 36% of Maryland’s pension investments are in public equity, or publicly traded stocks, the largest portion of its portfolio, and those positions had an annual fiscal 2021 return of 44.5%.
With the fiscal 2021 return, Maryland’s pension fund rose by $13.3 billion and ended the fiscal year with assets totaling $67.9 billion.
“It was an extraordinary year for the performance of System assets, the best in 35 years,” Chief Investment Officer Andrew Palmer said in a statement.
“The attractive investment opportunities provided by the pandemic and subsequent monetary and fiscal policy responses are apparent in the rearview mirror but were not always clear in real time. Fortunately … the system was able to fully participate in the very strong returns available in most markets.”
In addition to 168,000 current state employee retirees, the Maryland State Retirement and Pension System administers retirement and pension investments for more than 245,000 current and former state employees who have not yet reached retirement age.