Our Pension Assumptions Are Fine — Letters to the Editor – WSJ.com

3 Dec

Your Nov. 23 editorial “Illinois the ‘Unfixable'” doesn’t provide your readers with an accurate view of investments made by the Illinois Teachers’ Retirement System.

You note that the TRS investment return in fiscal year 2012, 0.76%, failed to reach our assumed return rate of 8% in that year. This, however, is misleading. The TRS assumed return isn’t a one-year target, but a 30-year goal. TRS will always focus more on long-term investment results. We won’t reach that goal every year.

But in the last 32 years, TRS has achieved a return of 8% 21 times. The average TRS annual investment return for the 30-year period ending in 2012 was 9.6%.

If the Journal wants to compare returns from individual years against the long-term target, the TRS return in FY 2011 was 23.6% and 12.8% in FY 2010. More…

via Our Pension Assumptions Are Fine — Letters to the Editor – WSJ.com.

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