Periods of economic change and uncertainty often bring questions about how Oregon’s public retirement fund is managed - and whether it’s prepared for whatever lies ahead. Markets rise and fall, sometimes sharply, and this is why at the Oregon State Treasury our investment strategy is built on resilience not reaction or chasing short term gains. A strategy that has helped make the Oregon Public Employees Retirement Fund (OPERF) one of the largest and most respected public pension funds in the country.
The fund’s resilience is anchored in disciplined asset allocation, thoughtful portfolio diversification, and active management. This strategy means that no single market trend or asset class dictates OPERF’s success – helping safeguard the retirement security of Oregonians not just for the next year, but for decades to come.
A Diversified Portfolio Built for Generational Retirement Security
The state’s retirement fund spans a diverse mix of assets across public and private markets - public equities, fixed income securities, real estate, alternative investments that include infrastructure, and private equity.
With OPERF steadily growing and nearing $100 billion, it’s important to note OPERF is not constructed to chase short-term market highs, nor is it overly reactive to downturns. Instead, the portfolio is strategically designed to deliver stable, risk-adjusted returns in years when markets are performing well and to preserve capital during periods of market stress.
Managing OPERF is much like the agricultural industry. You wouldn’t plant only the fastest-growing crop for one record harvest – you plant a variety, some that produce quickly and others that grow steadily over time. This way, even if one season brings drought, there’s still a reliable harvest. OPERF’s asset mix works the same way, blending investments that do well in strong markets with others that hold value in tougher times, sustaining both its capital base and its long-term growth potential.
Treasury’s decisions on asset allocations are informed by in-depth asset-liability studies every four years, helping anticipate future needs under a wide range of economic conditions. Throughout this work, Treasury is guided by a clear legal mandate: Oregon trust funds must be invested to make the moneys as productive as possible for the sole and exclusive benefit of their beneficiaries.
Strengthening Against Volatility
That’s not to say real-world scenarios don’t have an impact on the portfolio. Oregon learned hard lessons during the 2008–2009 global financial crisis, which reflected a need for increased diversification. In the years since, Treasury has taken deliberate steps to strengthen OPERF against volatility, expanding its exposure to less correlated asset classes like agriculture and timberland.
The strategic development of asset diversification within the portfolio has made the fund more resilient across all phases of the economic cycle, evident by the fund’s performance in recent years; generating 20% returns in a strong market year like 2021 and proving resilient in down market years like 2022 when the fund outperformed most pension plan peers by 10%. The 2022 performance earned OPERF recognition as one of the top performing funds in 2022, and over the past 20 years.
For the 10-year period ending June 2025, OPERF earned an average annual return of 7.6%, outperforming both Treasury’s passive reference portfolio (68% public equities and 32% bonds) and the retirement system’s assumed rate of return of 6.9%. These results reflect the value of a thoughtfully constructed, diversified approach that is designed not just for the next 1, 5, or 10 years – but for the next 50.
In all market scenarios, Treasury’s investment staff closely monitors OPERF to ensure adequate funds are available for monthly retirement payments. This work entails discussions with the Oregon Investment Council (OIC) and coordination with investment consultants to analyze how the portfolio will respond to different scenarios. This proactive and diligent oversight of OPERF is what has allowed Treasury to deliver dependable funds for retirement benefits consistently month-after-month, year-after-year for nearly 60 years.