Wall Street Fees and Investment Returns for 33 State Pension Funds

Abstract

The study outlines fees and investment returns for state pension funds. The study concludes that states with the highest fees, as a percent of assets, had the lowest returns. The study shows a passive index mimicking state fund asset allocations provides higher returns. Private equity funds and hedge funds in which the states invested under performed relevant benchmark returns. The study provides some rationales for why the situation continues even though it costs states billions each year in foregone income.