NHRS Realizes 1.1% Investment Return in Fiscal Year 2020

Trust fund assets stood at $9.2 billion as of June 30, 2020

Oct 23, 2020

For Immediate Release: October 23, 2020
Contact: Marty Karlon, Director of Communications & Legislative Affairs, (603) 410-3594; [email protected]

CONCORD, NH – The New Hampshire Retirement System (NHRS, the retirement system) realized a 1.1% return on investments in the fiscal year ended June 30, 2020. 

The three-year, five-year, 10-year, 20-year, and 25-year returns for the periods ended June 30, 2020, were 5.2%, 5.9%, 8.7%, 5.4%, and 7.5%, respectively.  All returns are net of fees. The retirement system’s assumed rate of investment return is 6.75%.

“As long-term investors, we know that we will see returns above and below our assumed rate of return in any given year. We continue to emphasize that our primary focus is to meet or exceed the retirement system’s assumed rate of return of 6.75% over the long term,” said NHRS Executive Director George Lagos. “Like all investors, NHRS has dealt with a volatile and challenging investment landscape in recent years that has been exacerbated this year by the COVID-19 pandemic.”

NHRS has a diversified investment portfolio which, in any given year, can diverge from market indices. FY 2020 investment performance was impacted negatively by diversification away from the S&P stock index and the Barclays Aggregate fixed income index. Historically, this diversification strategy has outperformed these indices.

NHRS pursues a long-term investment strategy designed to meet its funding requirements and to reduce risk and mitigate volatility. The Board of Trustees, with research and input from NHRS investment staff, outside experts, and a recommendation from the Independent Investment Committee (IIC), set an investment policy that includes asset allocation targets and ranges.  The IIC continuously monitors and evaluates performance on a monthly basis, and makes determinations regarding the hiring and retention of fund managers. 

At the close of the fiscal year, the retirement system’s unaudited net position held in trust was $9.134 billion, a decrease of $74 million over the prior fiscal year, which stood at $9.208 billion. Since June 30, 2009 – the depths of the great financial crisis – NHRS trust fund assets have more than doubled, despite paying out more than $6 billion in benefits over that same period. Nearly 80 percent of benefit recipients continue to reside in New Hampshire, which means most of these benefit payments remain in-state, helping support the local economy.

Further information on the retirement system’s investment performance is available online at: https://www.nhrs.org/funding-and-investments/investments

Detailed fiscal year 2020 financial and investment information will be included in the retirement system’s Comprehensive Annual Financial Report (CAFR) and Comprehensive Annual Investment Report (CAIR), both due out in December.

About NHRS

NHRS provides retirement, disability, and death benefits to its eligible members and their beneficiaries.  The State of New Hampshire and nearly 470 local government employers participate in NHRS for their employees, teachers, firefighters, and police officers.  NHRS has approximately 48,000 active members and 38,000 benefit recipients. NHRS administers a defined benefit plan qualified as a tax-exempt entity under sections 401(a) and 501(a) of the Internal Revenue Code. 

#  #  #