FORT PIERRE, S.D. (KELO) — A key member from the State Investment Office explained to trustees Thursday how South Dakota Retirement System assets gained a net 4.88 percent for the fiscal year that ended June 30.
Tammy Otten said the portfolio’s value stood at $12.46 billion that day.
The system finished 24 percent underweight in global equities and 22 percent overweight in cash, because markets remain priced beyond where Investment Council members felt comfortable.
Otten said investment staff moved $900 million back into markets on December 24, while most state government employees were officially off work preparing for the Christmas holiday.
The December volatility paid off in March. “We just had this big V in the process and we took advantage of that,” she said.
The assets are still at the second-lowest level of risk, according to Otten. The system had four years when it lost money since its start in 1975, she said: The 2001-2002 ‘dot-com’ bubble and the 2008-2009 recession.
In 2019, big-tech stocks did well and SDRS wasn’t heavily invested in those, Otten said.
“Our stocks were just more conservative, more value-oriented,” she said.
The net returns for SDRS in the previous four years were 7.94 percent, 13.81, 0.30 and 4.18. The system’s long-term goal has been revised down to an average of 6.5 percent.
“Overall we have had a very good 10-year run,” she added. “One year is noise to us.”