Investment Update in Response to COVID-19

March 30, 2020


SBCERA members and employers,

We want to reassure you that despite these turbulent times and markets, your pension has mechanisms and strategies to protect your income, now and in the future. Since the initial spread of coronavirus (COVID-19), we have seen a global economic stress and related volatility in markets. This has undoubtedly challenged the pension industry.

As we approach the end of our fiscal year on June 30th, we do not know what our gain or loss for the year may be, but more importantly, the general markets will not be reflective of SBCERA’s investment experience. Our fund was less impacted in large part because of our defensive posture going into the downturn and our ability to buy when others might be selling. We have a long term view and a long term strategy, so at no point is SBCERA required to change its strategy.

SBCERA is financially stable to not only pay promised benefits, but we are also deploying cash opportunistically to invest in sectors and assets that are now offering far better value than just one month ago. SBCERA has an investment strategy that focuses on income and we’ve built an investment portfolio designed to generate positive returns over decades — rather than days, weeks, or months.

Over the last 40 years, we’ve earned an average annual return of more than 8% on our investments, a period which includes numerous recessions and other economic disruptions — including the global financial crisis, which had an even broader sell-off than the one we are experiencing now.

While our fund is not immune to short-term volatility and extreme market fluctuations, our proactive strategy helps SBCERA provide retirement security to our members now and well into the future.

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