The falling markets have caused the Indiana Public Retirement Fund to lose about $700 million in just 1 day of trading. The $22 billion system has fielded a few calls from retirees concerned about what a bear market could do to their pensions.
The answer: not as much as you’d think. INPRS spokesman Jeff Hutson estimates Monday plunge sliced three-percent of the funds’ portfolio. But he says only about 41-percent of the pension fund is invested in stocks. The rest is in fixed-income securities and other investments designed to protect the fund against precisely this kind of swing in the market.
Hutson notes the funds have the advantage of being able to think in terms of the next 30 years. But he says staffers have had to reassure a few retirees who called the fund office after the Dow’s nosedive.
Hutson says fund managers won’t push the panic button in response to a single day’s events, but do constantly evaluate whether long-term trends suggest altering the mix of investments.