Farouki Majeed, CIO of Ohio SERS: “Private equity continues to be the highest returning asset class in our portfolio over 10 years and longer periods and thus contributes positively to the long-term sustainability of the pension fund.”
WASHINGTON, D.C. – Today, the American Investment Council released its 2026 Pension Trends Report, showing that private equity remains the best-performing asset class for America’s public pension funds. Private equity investments delivered a median annualized return of 13.2% over a 10-year period across the 200 pension funds studied, representing nearly 34 million public-sector workers and retirees. Private equity outperformed every other asset class over the long term, including public equity, real estate, and fixed income.
“America’s firefighters, police officers, and teachers spend their entire careers serving the public. They deserve a secure retirement, and private equity helps provide it,” said AIC President and CEO Will Dunham. “Year after year, private equity has consistently been the highest-performing asset class for public pension funds across the country, helping more than 34 million public servants benefit from strong returns and diversified portfolios built for the long term.”
AIC’s annual study has found that private equity has been the highest-returning asset class in public pension portfolios every year since 2012. Nearly nine in ten public pensions studied invest in private equity, underscoring its longstanding role in supporting retirement security for public servants across the country.
By The Numbers:
- 13.2% – The private equity median annualized return over a 10-year period, higher than every other asset class, including public equity, real estate, and fixed income.
- 34 Million – The number of U.S. public sector workers and retirees served by the pension funds in the study.
- 86% – The share of public pension funds nationwide that invest a portion of their portfolio in private equity.
- 88% – The share of institutional investors surveyed by Preqin who plan to increase or maintain their private market investments over the next year.
Top Ten Public Pension Funds by Private Equity Returns:
- Vermont Pension Investment Commission – 16.61%
- Ohio School Employees Retirement System – 16.27%
- Massachusetts Pension Reserves Investment Trust – 16.18%
- West Virginia Investment Management Board – 16.12%
- Tennessee Consolidated Retirement System – 16.04%
- City of Baltimore Employees’ Retirement System – 15.80%
- Nebraska Investment Council – 15.40%
- The Florida Retirement System – 15.33%
- Public School and Education Employee Retirement Systems of Missouri – 15.20% (tie)
- Illinois State Board of Investment – 15.20% (tie)
What Pension Leaders Are Saying:
Public pension leaders across the country highlighted the role private equity plays in generating strong long-term returns and supporting retirement security for their beneficiaries:
- Farouki Majeed, Chief Investment Officer, Ohio School Employees Retirement System – “Private equity continues to be the highest returning asset class in our portfolio over 10 years and longer periods and thus contributes positively to the long-term sustainability of the pension fund.”
- Eric Henry, Chief Investment Officer, Vermont Pension Investment Commission. – “…The illiquidity premium has benefited the members and beneficiaries of the Vermont State Employees’ Retirement System, the Vermont State Teachers’ Retirement System, the Vermont Municipal Employees’ Retirement System, and the taxpayers of Vermont. The credit for our strong performance goes to my team, whose tireless efforts have built our strong private equity program, and to the members of the Vermont Pension Investment Commission, who have pushed us to build a world-class program and supported our efforts in doing so.”
- Michael Brakebill, Chief Investment Officer, Tennessee Consolidated Retirement System. – “TCRS is honored to be identified by the AIC as one of the highest performing private equity programs in the nation. The attractive, long-term returns generated by the TCRS private equity program have contributed to a funded status exceeding 100%, helping to secure the financial future of more than 400,000 active and retired members. We continue to believe a prudently diversified, high-quality private equity program remains a material contributor to the financial security of the plan’s beneficiaries in the years ahead.”
- Michael G. Trotsky, Executive Director and Chief Investment Officer, MassPRIM – “I am proud that the American Investment Council’s research has again recognized MassPRIM’s private equity portfolio as one of the top performers in the country, ranking #3 this year. The PRIT Fund’s 10-year annualized private equity return of 16.18% outperformed the median of 13.20%, reflecting our team’s deep industry knowledge, disciplined selection processes, and rigorous monitoring. Private equity remains an essential part of a diversified portfolio, and these qualities have helped deliver the long-term returns needed to secure retirement benefits for more than 300,000 current and future retirees in our state.”
To learn more, read the full 2026 Pension Study.