CalPERS Posts 23.3% Gain for 2003

The California Public Employees’ Retirement System, the largest U.S. pension fund, earned a 23.3% return on its portfolio last year as stocks rallied worldwide.

The fund’s assets increased by $30.4 billion to $161.1 billion in 2003. The U.S. stock market recovered last year after three consecutive years of losses. The fund had 68% of its assets invested in equities, 25% in bonds and 7% in real estate at year’s end.

The size of the 2003 return may mean that governments that contribute to CalPERS for 1.4 million public employees won’t have to make larger contributions, said Rob Feckner, chairman of the fund’s investment committee. The fund said it had needed a return of 8.5% in 2003 to meet projected retirement payments.

CalPERS’ U.S. stock investments rose 31% for the year, beating the Wilshire 2500 benchmark’s return of 30.7%, the fund said. Its foreign stocks rose 38.8% and hedge fund investments rose 16.7%.