Over the past 12 months, the Pennsylvania Public School Employees’ Retirement System (PennPSERS) returned 10.26%, with its private infrastructure portfolio emerging as a bright spot during the fiscal year ended March 31, 2026.
According to its latest annual report, the pension fund PennPSERS posted solid long-term annualized returns of 8.49% over three years, 7.42% over five years and 8.41% over 10 years.returned 6.12% for the fiscal year, compared with its blended policy benchmark return of 7.78%, while total fund assets increased to roughly $85.7B.
“Our long-term investment performance remains strong, with annualized returns over the three-, five- and 10-year periods remaining above the system’s 7% actuarial objective,” Richard Vague, chair of the PennPSERS Board of Trustees, said in a press release.
PennPSERS’ portfolio remained diversified across public equity (30.7%), public fixed income (24.0%), private real assets (11.8%), private equity (11.5%), public real assets (11.1%) and private fixed income (6.7%) as of March 31. The fund’s higher allocation to fixed income weighed on returns as the asset class lagged public equities and real assets, although private credit remained an important driver of performance, returning 6.61% for the fiscal year and outperforming its benchmark by 13 basis points. Within private real assets, negative returns from private real estate offset stronger performance from private infrastructure. A slight overweight to gold added 32 basis points while an underweight to public commodities, excluding gold, reduced returns by 57 basis points.
Manager selection accounted for the majority of the fund’s relative underperformance, detracting 148 basis points overall. The shortfall was driven primarily by private equity, which detracted 96 basis points, and non-U.S. equity, which detracted 62 basis points. Those headwinds were partially offset by private infrastructure, where manager selection added 22 basis points to total fund performance.
“While market performance can vary from quarter to quarter, our disciplined and diversified investment strategy has helped generate strong long-term returns by balancing investment risk to support the retirement security of our members,” Susan Lemmo, PennPSERS’ Board of Trustees vice-chair, said in the release.