How We Work
Our Methodology
Transparent, rigorous, and independent. Our benchmarking methodology is designed to produce the most accurate and actionable pension performance metrics available.
Data Collection
All data is sourced exclusively from publicly available pension fund annual reports, Comprehensive Annual Financial Reports (CAFRs), and audited financial statements. We do not rely on self-reported data from fund managers and we do not adjust reported returns to try and account for inter fiscal year market variations.
Peer Group Construction
Our ranking is based on all funds in the database, which in 2024 represented 95% of US Public Plans. We do not select different peer groupings which can skew the results and prevents misleading implications that are driven by the peer group population. This sets us apart from other benchmarking methodology.
Performance Calculation
Net investment returns are calculated after all investment management fees, administrative costs, and transaction costs. We use time-weighted returns (TWR) consistent with GIPS standards for all multi-period calculations.
Expense Analysis
Total investment costs are expressed as a percentage of ending assets under management. We include GASB investment expense as reported by each fund's CAFR.
Ranking & Scoring
Basis Point LLC has developed an algorithm to rank pension fund ROR performance to allow for different fiscal year ending dates withing the same fiscal year. CAFR reported returns for 1, 5, and 10 year timeframes are measured against the same 60/40 generic index for those corresponding end dates. These are then weighted as follows; 1 year ROR at 1/6, 5 year ROR at 2/6, and 10 year ROR at 3/6. The indexes used are the S&P500 and the Bloomberg US Investment Bond Index. This process ensures that all funds are measured against the same index for comparison purposes.
Annual Review
All data and rankings are updated annually following the close of each fiscal year. Methodology changes are disclosed publicly and applied retroactively to maintain historical consistency.
Questions About Our Methodology?
We welcome scrutiny of our methods. Schedule a call to discuss our approach in detail.
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