May 22, 2025
Markets and PRIT Fund Performance
The PRIT Fund ended the March 31, 2025, quarter with a balance of $110 billion, essentially flat, despite U.S. equity markets falling by more than 4% and heightened volatility in both equity and bond markets. U.S. equity markets were the hardest hit, but the PRIT Fund’s international equity exposures fared better posting positive returns for the quarter. Additionally, bonds and alternative investments provided an additional buffer to weaker U.S. equity markets.
Legendary investor Warren Buffett wrote soon after the stock market crash of 1987 including “Black Monday,” the largest single day drop in the market’s history (DJIA down 508 points or 22.6%), “…an investor will succeed by coupling good business judgement with an ability to insulate his [or her] thoughts and behavior from the super-contagious emotions that swirl about the marketplace.”
Buffett’s quote is an excellent summary of what the entire PRIM team is doing at this important time. We are busy monitoring every aspect of the Fund, and we have been in close contact with the investment managers and industry experts who support PRIM to ensure that we are well-informed. As usual, we are analytical, disciplined, and unemotional about every investment decision we make. Importantly, we adhere to our fundamental investment philosophy that “we can’t accurately predict the future, so we don’t try, and we can’t predict the future of the financial markets, so we don’t try.” Instead, the PRIT Fund is a carefully constructed, broadly diversified portfolio with components that will perform well in any environment. Critical to our beneficiaries and stakeholders is the fact that PRIM is not facing any liquidity stress due to recent volatility, and we can easily meet all commitments. In short, the Fund is performing well, is well-positioned, and resilient.
The market environment and government policy decisions are changing quickly. We were encouraged in early April to witness a quick reversal of policy decisions after the bond market flashed warning signs during a spike in volatility; equity markets rebounded strongly in the subsequent days. Some believe that the bond market is the ultimate enforcer, that an orderly bond market which enables the Government to borrow and finance itself with consistency is a fundamental force of immense and independent power. At that critical moment, the bond market appeared to have extraordinary coercive power.
We don’t know exactly how this Administration’s tariff plan will play out and how policies will impact the economy. It is impossible to predict, but we saw some cooler heads prevail and the markets have responded positively in April and into May. There are many risks to the market and the economy right now, and there are so many unknowns. However, it is our job at PRIM in the words of a Winston Churchill-era slogan, to “Keep Calm and Carry On.” That’s what we are doing at PRIM. We are maintaining and carefully monitoring a broad diversified portfolio which contains strategies that will perform well no matter what the future holds.
Organizational Update
Private Equity International has named Helen Huang, Senior Investment Officer on the Private Equity team, a member of its annual “40 under 40: Future Leaders of Private Equity” list. The publication credits Helen with helping to “reinvigorate the pension plan’s venture capital program [and contributing] significantly to PE investment process design.” The publication lauded PRIM PE team’s proactive approach to sourcing new ideas and status as one of the top-performing public pension funds for 10-year private equity returns.
*PRIM claims compliance with the Global Investment Performance Standards (GIPS®). GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein. You may obtain a GIPS® Asset Owner Report by emailing mliposky@mapension.com.
