When you read about the performance of stock markets (stocks are also called equities), you'll likely see mentions of how any given stock exchange or group of stocks is doing compared to earlier time periods and other measures.
For example, take the Standard & Poors (S&P) 500. Investors often use the S&P 500 index as a benchmark or barometer for equity performance. It's a useful grouping because the S&P contains 500 of the largest U.S. publicly-traded companies. However, there are many types of benchmarks that investors can use, depending on the investments, risk tolerance and time horizon.
TRS' investment professionals are no strangers to using benchmarks. Allocating your pension trust fund dollars to a diverse range of investments provides opportunities to not only match, but beat various benchmarks. Any profits from these kinds of investments are known as excess return or in investment speak, “alpha."
So how much alpha has TRS generated? Your board of trustees saw a presentation in September 2023 that showed the pension fund has grown by $112.8 billion over the last decade. Of that growth, $9.9 billion was excess return produced for you and other TRS members to be rolled back into the fund!
Looking confidently ahead, alpha production over the next 10 years is expected to have added $15 billion as TRS continues to keep a close eye on the long-term health of your pension trust fund.