By Staff
The OPSEU Pension Trust generated an annual return of 9.6%
in 2024, with gold emerging as a star allocation.
According to its latest annual report, the pension plan’s assets reached $26.8 billion, up from $25 billion in 2023. OPTrust’s returns outdrove its average net earnings since inception (7.9%) and exceeded that of 2023 (5.3%). Over 10- and five-year periods, the plan saw average returns of 7.0% and 7.2%, respectively. It also outdrove its 10-year average net earnings since inception (7.9%). It remains fully funded for the 16th consecutive year.
The pension fund’s risk management portfolio produced the strongest
returns of 33.9%, largely driven by its exposure to gold in both static and
dynamic strategies. Returns on the plan’s U.S. dollar holdings were also
positive, while government bonds and trend-following strategies delivered
weaker returns.
Please Click Here to Register Now!
OPTrust’s public equities portfolio was one of its best-performing asset classes in 2024, generating a net return of 21.3% — driven by strong performance from U.S. equities. Additionally, its multi-strategy
investments, alternative risk premia and pure alpha strategies delivered strong
returns, generating an overall return of 9.8%. However, its credit investments declined
2.5% from in 2023, generating a net return of 9.5%.
While its infrastructure portfolio generated a net return of
6.7% in 2024, the plan’s real estate portfolio’s returns slipped further into
negative territory (-4.5%) from -1.9% in 2023. The report noted the decline was
indicative of the challenging conditions in some commercial real estate market
segments. Although the plan’s commodities investment saw a modest return of 1.7%,
it was a marked increase from in 2023 (-2.7%) and 2022 (-7.1%).
“As long-term investors, our strength lies in our ability to
look past short-term noise to see long-term value in different assets and
investment strategies,” said Peter Lindley, OPTrust’s president and chief executive
officer, in the report. “Thanks to our member-driven investing strategy,
long-term perspective and our world-class team of investment professionals, we
have continued to deliver strong results on our investments and pension
certainty for our members and retirees.”
