South Dakota Retirement System investments rose more than 8% since July 1, despite a third being in cash, state investment officer Matt Clark told the system’s trustees Thursday.
“We would be higher if we weren’t so conservatively positioned,” he said. “But that’s our strategy.”
The performance through November 30 follows a 1.59% gain for the previous fiscal year ending June 30, when total value edged up to $12.46 billion. The system operates on an assumed 6.5% rate of return [Bob Mercer, “SDRS Investments Look Stronger This Year,” KELO-TV, 2020.12.10].
Clark says the state is being cautious because he smells a market correction coming:
He believes the stock market overall is over-priced.
“And we won’t get hurt so bad when the markets go down, if they go down,” he said [Mercer, 2020.12.10].
With Congress’s inability to turn stimulus talk into action and the unexpected jump in jobless claims last week, Clark may have cause for caution with our money, and for years, he hasn’t let us down with his sensible positions. But Europe is looking optimistic (think “shares related to government spending, such as green, digital and traditional infrastructure, rather than consumer oriented sectors“), and we should get bumps from both the vaccines and the restoration of rational government.
Maybe that’s why people really want to move to South Dakota: a solid pension system run by government!