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TRS Investment Strategies Protect Member Assets

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SPRINGFIELD, IL – The diversified, risk-aware investment strategy employed by Teachers’ Retirement System in response to an unpredictable economy and roller-coaster markets protected System assets during the first nine months of fiscal year 2022.

At the end of the March quarter of fiscal year 2022, TRS assets totaled $66.1 billion, in line with the $66.02 billion total recorded at the end of the December quarter. TRS was able to retain value in spite of market declines, including a negative 4.6% March quarter return for the Standard & Poor’s 500 Index.

So far during FY 2022, TRS has continued to increase the size of its investment portfolio. The System began FY 2022 with $63.9 billion in assets and in nine months has realized a positive 4.2% return, net of fees. The System’s fiscal year runs annually from July 1 to June 30.

“The ‘defensive’ and value-aware investment strategy TRS has employed for some time is paying off for our members,” said Stan Rupnik, executive director and chief investment officer for TRS. “Our top priority is protecting our members’ money for their retirements. Long before economic pressures began to build, TRS took steps to lessen the effects of any unpredictability in the markets. So far, that strategy has been successful.”

Between February and May, TRS committed more than $5 billion to investment managers around the world. During its regularly scheduled June meeting, the TRS Board of Trustees reviewed the following investment actions:

  • Within the System’s $10.4 billion Private Equity Portfolio:
    • The commitment of up to $125 million to Advent International Corporation, of Boston, Massachusetts. Advent currently manages $230 million in TRS assets.
    • The commitment of $150 million to Arlington Capital Partners, of Chevy Chase, Maryland. Arlington currently manages $90 million in TRS assets.
    • The commitment of $200 million to EQT Fund Management, of Stockholm, Sweden. EQT currently manages $200 million and €410 million in TRS assets.
    • The commitment of $100 million to Francisco Partners, of San Francisco, California. Francisco is a new investment relationship for TRS. 
    • The commitment of €75 million to Providence Strategic Growth Capital Partners, of London, United Kingdom. Providence currently manages $75 million in TRS assets.
    • The commitment of $200 million to RCP Associates, of Chicago. RCP currently administers $750 million in TRS assets.
    • The commitment of $125 million to SK Capital Partners, of New York, New York. SK currently administers $120 million in TRS assets.
    • The commitment of $200 million to Veritas Capital Fund Management, of New York, New York. Veritas currently administers $550 million in TRS assets.
    • An additional commitment of $14 million to Grain Management, of Sarasota, Florida. Grain currently administers $119 million in TRS assets.
  • Within the System’s $11.9 billion Real Assets Portfolio:
    • The commitment of up to $300 million to the Blackstone, Inc., of New York, New York. Blackstone currently administers $776.3 million in TRS assets.
    • The commitment of up to $100 million to Gateway Capital, of Hong Kong. Gateway currently administers $50 million in TRS assets.
  • Within the $16.3 billion Global Income Portfolio:
    • The commitment of $100 million to Pharmakon Advisors, of New York, New York. Pharmakon, a Women or Minority-owned Business Enterprise, is a new investment relationship for TRS. 
    • The commitment of $150 million to Cerberus Capital Management, of New York, New York. Cerberus currently manages $419.6 million in TRS assets. 
    • The commitment of $75 million to Dignari Capital Partners, of Hong Kong. Dignari is a Women or Minority-owned Business Enterprise and currently administers $22.7 million in TRS assets. 
    • The commitment of $100 million to Edelweiss Alternative Asset Advisors, of Mumbai, India. Edelweiss is a Women or Minority-owned Business Enterprise and currently administers $71 million in TRS assets.
    • The commitment of $25 million to L2 Point Capital, of San Francisco, California. L2P is a Women or Minority-owned Business Enterprise. This is a new investment relationship for TRS.
    • The commitment of $350 to $400 million to Payden & Rygel, of Los Angeles, California. Payden is a Women or Minority-owned Business Enterprise. 
    • An additional commitment of $250 million to Apollo Global Management, of New York, New York. Apollo currently administers $850.8 million in TRS assets.
    • An additional commitment of $150 million to Beach Point Capital Management, of Santa Monica, California. Beach Point currently administers $434.2 million in TRS assets.
    • An additional commitment of $200 million to Hayfin Capital Management, of London United Kingdom. Hayfin currently administers $268.9 million in TRS assets.
    • An additional commitment of $225 million to Intermediate Capital Group, of London, United Kingdom. ICG currently administers $440.3 million in TRS assets.
    • An additional commitment of $225 to Pacific Investment Management Company, of Newport Beach, California. PIMCO currently administers $2.2 billion in TRS assets.
  • Within the $4.9 billion Diversifying Strategies Portfolio:
    • The full redemption of $250 million from Light Sky Macro, of New York, New York.
  • Within the System’s $22.5 billion Public Equity Portfolio:
    • The commitment of $400 million to Causeway Capital Management, of Los Angeles, California. This is a new investment relationship for TRS.
    • The commitment of $400 million to J.P. Morgan Investment Management, of New York, New York. J.P. Morgan currently administers $840 million in TRS assets.
    • The commitment of $400 million to T. Rowe Price Associates, of Baltimore, Maryland. This is a renewed investment relationship for TRS.
    • The commitment of $400 million to William Blair Investment Management, of Chicago. This is a new investment relationship for TRS.
    • The termination of a Domestic Large Capitalization Value Strategy of LSV Asset Management, of Chicago. LSV continues to administer $1.5 billion in TRS assets.
    • The termination of two passive Growth strategies administered by RhumbLine Advisors, of Boston, Massachusetts. RhumbLine continues to administer $9.9 billion in TRS assets. 

About Teachers’ Retirement System

The Teachers’ Retirement System of the State of Illinois is the 42nd largest pension system in the United States, and provides retirement, disability and survivor benefits to teachers, administrators and other public school personnel employed outside of Chicago. The System serves 434,000 members and had assets of $66.1 billion as of March 31, 2022.
 

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