The Washington State Investment Board (WSIB), which manages a $99.4 billion public pension fund, has committed up to $1.6 billion in new private market investments across private equity, real estate and real (tangible) assets. Private assets now make up close to 40% of the total investment portfolio, compared to public equities which make up 31%.
WSIB has among the highest levels of commitment to private market investments of any U.S. pension fund, which has helped the fund outperform many of its institutional peers with portfolio returns as high as 10.4%. Their strategy mirrors that of many prominent public pension funds that are seeking diversification and uncorrelated returns in the private markets. As a result, the private markets have suddenly been opened up for the public employees, teachers, police officers and other state employees that invest in these state pension funds.
As capital continues to shift towards the private markets, the need for secondary liquidity and market transparency will continue to rise. We believe digital securitiesare the logical answer to this challenge.