Industry News

On April 15, 2025, the National Association of State Retirement Administrators (NASRA) released its report, Short-Term Market Volatility and Public Pension Plans. The analysis examines the short-term market volatility of public pension plans. Although short-term market volatility may be concerning for public pension plan stakeholders, NASRA’s commentary indicates that short-term market declines should be analyzed in the context of a long-term, disciplined investment approach.

Some of the key findings include:

• Public pension funds are long-term disciplined Investors;
• The funds invest in diversified portfolios; and
• Their funding policies help to mitigate short-term volatility.

The report concludes: “Public pension funds are built on a foundation of long-term strategy, diversified portfolios, and disciplined investment policies that account for the ups and downs of financial markets. Tools such as asset smoothing, strategic asset allocation, and periodic portfolio rebalancing help public pension plans maintain funding stability and meet long-term obligations. While short-term market movements can draw attention, they are not a reliable measure of a fund’s overall health or trajectory. By staying focused on their long-term goals and maintaining a steady hand during periods of volatility, public pension plans are positioned to continue providing secure retirement benefits for generations to come.”

The report is available here.