Stock market rally helps add $20B to Virginia’s pension fund

The Virginia Retirement System reports its investment portfolio topped $100 billion for the first time in its history in fiscal year 2021, and it was largely thanks to the surging stock market.

Virginia’s pension account gains were similar to those reported by the Maryland State Retirement System.

For fiscal 2021, which ended June 30, VRS investments had an annual return of 27.5%, net of fees, pushing its portfolio total to $101.8 billion, or $20.2 billion more than it ended fiscal 2020. VRS investments in publicly traded stocks saw an annual fiscal year return of 41%. Its private equity investments saw an annual return of 54.1%.

About 37% of Virginia’s pension portfolio was in public equity in fiscal 2021, its largest position.

The fiscal 2021 return was well above its annual assumed rate of return of 6.75%.

“We were in position to take advantage of conditions in the public equity, private equity and private credit arena, as well as our other asset classes. We also kept focus on our long-term investment strategy, pursing broad opportunities and optimal returns while balancing risk to deliver high value to the fund,” said Chief Investment Officer Ronald Schmitz.

Virginia just slightly bested Maryland’s pension fund return for fiscal 2021 of 26.7%, which was also well above its assumed annual return of 7.4%. Its portfolio had a similar share of public equity holdings, at 36%.

The Virginia Retirement System is responsible for investing pension funds for 742,000 active and inactive members, retirees and beneficiaries. The Maryland Retirement System covers 415,000 current and future retirees and their beneficiaries.

Jeff Clabaugh

Jeff Clabaugh has spent 20 years covering the Washington region's economy and financial markets for WTOP as part of a partnership with the Washington Business Journal, and officially joined the WTOP newsroom staff in January 2016.

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