The Fund’s fiscal year-end performance ranks as the highest dollar amount gain in SBCERA’s 45-year history. As of June 30, 2011, the Fund grew by more than $1.1 billion to $6.125 billion. The Fund’s total net return of 22.61 percent outperformed the SBCERA policy benchmark by 2.48 percent, or 248 basis points.
“This has been a remarkable year for SBCERA. It has exceeded all expectations,” said Dawn Stafford, Chair of the SBCERA Investment Committee. “The Fund’s performance demonstrates our steadfast commitment to setting sound investment strategies focused on minimizing risk and ensuring the long-term health and security of the pension fund on behalf of our members and plan sponsors.”
Recognizing ongoing volatility of the financial markets, the Board worked diligently over the last few years to build and maintain a well-diversified portfolio within a risk-based framework to allow for greater sustainability and stability over the long-term.
This fiscal year, SBCERA recorded only one month with a loss equaling 0.08 percent or 8 basis points in November 2010. All other months recorded gains.
The Fund also exceeded expectations for minimizing risk, as measured by the Sharpe ratio. The Fund produced a Sharpe ratio of 5.51. This is well above SBCERA’s policy benchmark of 2.55, which means the Fund had a much higher rate of return than expected for each incremental unit of risk taken during the year.
“SBCERA is a long-term investor,” said Interim Chief Investment Officer Don Pierce. “While we can’t predict how the markets will behave, SBCERA will continue to adhere to a disciplined investment process and deploy capital to endure a wide variety of possible economic outcomes.”
SBCERA has had an average net return of 9.52 percent since 1982. The Plan’s 2011 fiscal year-end asset allocation included 28.5 percent in public equities, 29.4 percent in fixed income, 7.4 percent in real estate and 18.8 percent in private equity. The balance is in other asset classes.
The latest performance reports are unaudited and based on data currently available.
The San Bernardino County Employees’ Retirement Association <http://bit.ly/lrDeYc> (SBCERA) provides its more than 32,000 members and their beneficiaries with retirement and related benefits and services which they have earned, commensurate with their years of service and compensation. The Board of Retirement’s responsibilities and functions are governed by the applicable provisions of the California Government Code, along with the bylaws and regulations of SBCERA.