Investments

MOSERS invests approximately $7 billion in retirement fund assets. The key focus of the investment program is on achieving broad diversification, which reduces the risk of the total portfolio. The fund invests in a variety of asset classes and holds a number of investments within each asset class.

Principles Guiding
MOSERS' Investment Activity

There are three fundamental principles which comprise MOSERS’ investment philosophy and guide asset allocation and investment decisions.

1. Preserve the long-term corpus of the fund

MOSERS’ approach to investing is unique when compared to an individual investor. As an institutional investor with an infinite time horizon, MOSERS must select a mix of assets that will allow for payment of benefits to retirees today and well into the future. MOSERS’ long-term time horizon enables the system to take on more aggressive strategies that will contribute to the future growth of the plan assets.

2. Maximize total return within prudent risk parameters

The fund seeks to gain the highest level of return for a given level of risk. Risk is defined as “volatility,” or the range of returns the fund may experience over a given period of time. The greater the anticipated return, the greater the volatility one must generally tolerate in order to achieve that return.

As an investor with dollars that will not be needed for many decades, short-term volatility is not as significant a concern to MOSERS as it might be for an individual investor. MOSERS does, however, seek to minimize risk through proper diversification of plan assets. This is achieved through finding an appropriate mix of assets that possess varying characteristics which help reduce the overall volatility of the fund.

3. Act in the exclusive interest of the members of the system

The Board, staff, and external investment consultant all work together to ensure that every action taken serves the long-term interests of the members and the system.