The Virginia Retirement System generated a 12.1% investment return, net of fees, during fiscal 2026, increasing the market value of its retirement trust fund to $135.2 billion as of June 30.
The annual return substantially exceeded VRS’ long-term actuarial assumed return of 6.75%.
The fund’s market value increased approximately 10.1% over the previous year, continuing a decade-long period of overall growth.
VRS also reported that its total investment performance met or exceeded its board-established custom benchmarks over the five- and 10-year periods.
Performance came in slightly below those benchmarks over the one- and three-year periods.
However, the fund’s three-, five- and 10-year returns all exceeded its 6.75% actuarial assumed rate of return.
Investment earnings are particularly important to VRS because they fund approximately two-thirds of retirement benefit payments.
Public equities were the strongest-performing major asset class during fiscal 2026, generating a 23.8% return.
Private investment partnerships returned 9.7%.
Credit strategies produced an 8.3% return, while diversifying strategies returned 7.1%.
Real assets generated 6.7%.
Fixed income returned 5.3%, while private equity generated a 5.2% return for the year.
VRS said its longer-term results demonstrate the benefits of combining diversified asset allocation with active investment management.
Over the past decade, the organization’s investment team has generated approximately $6 billion more than VRS estimates it would have earned through a passive indexed approach.
The retirement system emphasizes a long-term investment horizon rather than focusing primarily on short-term annual performance.
Its portfolio is structured across multiple asset classes intended to balance risk, return and liquidity requirements while supporting future pension obligations.
VRS ranks as the 15th-largest public or private pension fund in the U.S. and the 36th largest globally.
The system serves more than 861,000 active and inactive members, retirees and beneficiaries.
Its membership includes public school teachers, state employees, employees of cities and towns, public university personnel, law enforcement officers, state police and members of the judiciary.
Approximately 864 employers participate in the system.
KEY QUOTES:
“Managing a retirement trust fund requires a long-term commitment to responsible stewardship. Over the years, VRS has benefited from an experienced investment team that carefully manages the fund while remaining focused on its responsibility to members and retirees.”
“That added value strengthens the trust fund and helps maximize every dollar entrusted to us.”
Susan T. Gooden, Ph.D., Chair of the Virginia Retirement System Board of Trustees
“Results are built over years, not quarters. Our team stays focused on the long term, balancing risk and opportunity as markets change.”
“By combining broad diversification with active decision-making, we’ve added value across market cycles while positioning the fund to meet its obligations for decades to come.”
Andrew Junkin, Chief Investment Officer of the Virginia Retirement System
