INVESTMENTS: CIO'S ANNUAL LETTER	BACK TO INVESTMENTS HOME

Highlights from the June 30, 2007 CIO Letter

• Our return for the fiscal year was 18.7% (net of fees and expenses), which compared very favorably to the actuarially assumed rate of 8.5%. This resulted in over $717 million in gains to the system, making pensions more secure and reducing future costs to taxpayers.
  
  
• For the seventh straight fiscal year, MOSERS’ investments have generated returns in excess of our policy benchmark and have done so at a lower level of realized volatility. The cumulative incremental earnings resulting from these excess returns have added an additional $1.5 billion to MOSERS’ coffers. During FY07 alone, we added roughly $215 million relative to our policy benchmark.
  
  
• At the broad asset class level, public equities contributed strongly to the fund’s performance producing returns of 24.2%, our public debt portfolio generated 8.9%, while alternatives produced results of 18.6%.
  
  
• Our strongest performing subclasses included real estate delivering returns of 48.4%, emerging market equities producing 46.4%, developed international equities generating 25.5%, domestic equities posting 22.3%, and private investments in equity and debt adding 20.5% and 20.4%, respectively.
  
  
• Over most measurement periods including 1-, 3-, 5-, 10- and 15-years, our investment performance has outpaced 75% of the large public pension funds across the country.

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