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According to the report, private equity funds invested by large US pensions outperformed the public markets by 5.2 percentage points annually over a 10-year horizon. “Pension funds managing the retirements of teachers, police officers, firefighters, and public servants invest in private equity because it provides consistent, high returns over the long term,” said PEGCC President and CEO Steve Judge.
According to this latest report, CalPERS, the nation’s largest pension fund, currently has over $30 billion invested in private equity (10.3 percent of the total fund), and the pension’s private equity fund investments returned 12.9 percent, net of fees, annually over a 10-year horizon. By comparison, the S&P 500 returned 7.7 percent over that same period, including dividends.
“The data paint a clear picture: Private equity is an asset class that provides superior returns over the long-term with less volatility,” said Bronwyn Bailey, PEGCC’s Vice President of Research.