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KPERS Investments

The Fiduciary Standard

Dedicated Fiduciary

KPERS serves members as a fiduciary, holding assets in trust for them, growing those assets through investments and delivering promised benefits when the time comes.

The fiduciary standard is our driving force, particularly in investments. It is the highest standard of care and accountability. KPERS investments are made and managed for the sole purpose of providing benefits to our members and their beneficiaries.

Investment returns make up the largest source of income for paying benefits. They are a vital part of successful funding. Over the years, investments have paid for about 50% of benefits.

FY 2023 Year in Review | Quarterly Investment Performance Summary

KPERS Funding Sources

dollar bill graphic that shows member contributions: 17%, employee contributions: 36% and KPERS Investments: 47% dollar bill graphic that shows member contributions: 17%, employee contributions: 36% and KPERS Investments: 47%

Assets are invested according to the "prudent expert standard of care" for the sole purpose of providing benefits to our members.

KPERS Statement of Investment Policy, Objectives and Guidelines serves as a guide to implement broad investment objectives. The Statement complements KPERS’ statutes and documents the principles and standards that guide the management of System assets. It is binding for all persons with authority over the assets, including investment managers, custodians, consultants, staff and the board of trustees.

Among other things, the Statement establishes the criteria against which investment managers are measured. It also serves as a review document to guide ongoing investment oversight as a yardstick of compliance with the KPERS Retirement Act. The Statement is reviewed and updated annually.

Trust Fund Assets & Investment Returns (7.6% 25-yr return, with a 7% target. Assets have more than doubled in the last two decades.)

Managing KPERS’ dynamic and diversified portfolio requires significant investment expertise and experience.

KPERS has a three-way partnership to manage the portfolio:

  • KPERS internal investment professionals
  • Three investment consultants
  • External investment managers

Internal Investment Professionals

KPERS has a staff of nine investment professionals who provide oversight and management of the assets and the external investment managers retained by the System. Each asset class is overseen by at least one investment officer. Investment officers are supported by a team of investment analysts who provide research and assistance in managing the portfolios. KPERS' investment team is managed by the chief investment officer.

Investment Consultants

Meketa Investment Group is KPERS' general investment consulting firm. They are an independent, full-service investment consulting firm.

Mercer (Alternatives) is a full-service investment consulting firm that provides a broad range of investment advisory services focused on alternative assets including investment strategy and pacing, manager sourcing and screening, due diligence, portfolio monitoring and results reporting, in-depth market research and educational sessions.

The Townsend Group provides investment sourcing and underwriting, investment pacing, advisory board representation, results reporting and board education relating to real estate, timber and infrastructure investments.

External Investment Managers

Through a competitive hiring process, KPERS carefully selects qualified investment managers to construct and manage asset class portfolios that work together.

Our internal investment officers maintain a close relationship with each external manager. In partnership, they carefully monitor the asset portfolios, making adjustments as needed to benefit the Trust Fund. Active managers add value, not only for what investments they select, but also for those issues they avoid.

Every three years the KPERS Board of Trustees undertakes an asset/liability study to set our asset allocation.

With guidance from the System's investment consultants, the Board reviews liability projections (future benefits) and investment return assumptions across asset classes. Then considers the System's risk tolerance. Our investment goal is for the portfolio to provide the highest returns for the least amount of risk.

The study helps the Board find the target asset allocation that most effectively and efficiently supports future benefit payments when combined with future member and employer contributions.

KPERS Long Term Target Allocation:  U.S. Equity - 23.5%, International Equity - 23.5%, Core Fixed Income - 13.0%, Yield Driven - 6.0%, Real Return - 7.0%, Real Estate - 13.0%, Private Equity - 11.0%, Cash Equivalents - 3.0%