How PERA’s In-House Investment Experts Reduce Costs, Add Value

Colorado PERA manages a portfolio of $66.7 billion on behalf of more than 700,000 members and benefit recipients. It’s a big job that requires a high level of skill and expertise, and PERA’s in-house investment team has a wealth of experience that helps us save money while adding value for our members and retirees.

PERA’s approach to investment stewardship

At Colorado PERA, investment stewardship comprises four pillars that lay out our approach to managing plan assets:

• Protect members’ interests by watching costs.
• Integrate relevant factors into investment strategy.
• Advocate for robust markets.
• Evaluate exposures and recognize limitations.

We work every day to protect the retirement benefits our members have earned throughout their careers. One of the ways we do that is through low-cost, high-quality internal management of the majority of our investments.

Our team of more than 50 investment experts is highly skilled with extensive investment industry experience. That expertise reduces the need to use outside managers, minimizing plan expenses.

EXPLORE MORE: Investment Stewardship Digital Snapshot

Internal management reduces costs

As of the end of 2024, PERA managed 61% of all assets internally. By relying on our own staff, PERA maintains the flexibility to make investment decisions without paying high fees that often come with external management. PERA pays less than $4 for every $1,000 in the fund, saving an estimated $70 million annually in management fees that would have otherwise gone to outside experts.

“Internal management supports our ability to be agile in responding to market conditions while also saving PERA significant costs,” said Director of Fixed Income Keith Tayman.

Opportunities for cost savings can vary by asset class. For example, the team that manages the Global Equity portfolio—the largest of PERA’s asset classes—was an early leader in negotiating unbundled equity research and trading fees with broker-dealers. Strategies like that have helped PERA save 40% on annual spending with broker-dealers since 2011.

PERA’s investment team boasts an average of 21 years of experience. Such a high level of experience means staff can use their expertise and relationships with external managers to find additional opportunities for cost savings, such as negotiating lower fees.

“The long tenure of the Private Equity team positions PERA as a limited partner of choice,” said Private Equity Portfolio Manager Ryan Murphy. “Low turnover leads to stronger relationships with our partners. Stronger partnerships allow for preferred allocations and seats on advisory committees.”

PERA’s expertise in investment management is reflected in the inclusion of PERA staff in various industry organizations and advocacy groups. Our staff lend their knowledge and experience to groups such as the Council of Institutional Investors, Healthy Markets Association, the Public Company Accounting Oversight Board, and the Securities and Exchange Commission’s Investor Advisory Committee.

In addition to the PERA Defined Benefit (DB) Plan portfolio, investment staff also work to reduce costs in the PERA Defined Contribution (DC) Plan and the PERAPlus 401(k) and 457 Plans by increasing internal management of assets and negotiating lower fees with external managers. For example, since 2011, the all-in costs of the PERAPlus 401(k) Plan have decreased by 83%. Effective in 2025, participants pay a flat monthly fee of $1 per plan.

WATCH THE VIDEO: How Colorado PERA Invests for Long-Term Retirement Security

The value of a low-cost investment program

Investment income is the largest source of assets in the DB plan trust funds. Over the past 30 years, the portfolio has earned an annualized return of 8.4% and generated more than $88 billion for PERA members and retirees. Of every dollar a PERA retiree receives, 61 cents come from the investment income, while 39 cents come from contributions from members, employers, and the State.

As fiduciaries, every person on PERA’s investment staff is an expert committed to serving our members’ financial longevity. By working to reduce fees and other costs, the PERA investment team is able to keep more money available in the trust funds to invest on behalf of members. And that means a more secure, reliable retirement for Colorado’s public employees.

Learn more

• Investment Stewardship Report
• Investment Stewardship Digital Snapshot