The investment process begins by determing the
asset allocation, or how the funds in the Wisconsin Retirement System (WRS) are divided among broad asset classes, such as stocks, bonds, real estate and other
types of investments. Asset allocation and diversification are key components of long-term investment
The Core Fund is fully diversified. It includes a
mixture of holdings. In addition, the Fund is invested in companies that differ by size,
industry and location. Diversification in the Variable
Fund , which includes only equities, is achieved by investing in different
industries, company sizes and locations. Selecting an optimal asset mix is the
starting point in meeting the investment objectives of the WRS. Allocations are reviewed annually to
consider adjustments and new initiatives. Asset classes are listed below.
Public Equities (stocks)
Domestic: primarily common stock in US companies diversified among small-, medium-, and large-sized
International: primarily common stock in foreign companies in developed
Emerging markets: stocks in developing counrtries as defined by the
Fixed Income (bonds)
Domestic: US government bonds and corporate bonds purchased in public
markets meeting minimum credit quality requirements.
Global: developed country bonds meeting minium credit quality requirements.
Emerging markets: fixed income securities, mostly government debt, in developing
markets as defined by the
Commercial real estate
investments with SWIB as a sole direct owner or in joint ventures and partnerships
with outside managers that are diversified by location and property types and
diversified real estate investment trusts (REITs).
Leveraged buyouts and venture capital, mostly in funds or partnerships; direct, long-term loans to Wisconsin
companies; and private market investments that offer a current return.