In the second quarter of 2025, institutional funds—including corporate and public pensions; Taft-Hartley plans; endowments and foundations; and health and welfare plans—achieved a median investment return of 6.06%, according to data from Confluence Technologies Inc., below the 7.44% return from a traditional 60/40 benchmark.
The firm’s Q2 2025 Preliminary Plan Universe Performance Report found that plans with high equity allocations reported strong performance, as lows in early April following President Donald Trump’s tariff announcements reversed quickly following the announcement of a 90-day pause.
During the quarter, the Russell 1000 Index returned 11.11%, and the MSCI EAFE Index, which tracks non-U.S. equities, returned 12.7%. The U.S. Bloomberg Aggregate Index returned 1.21% in Q2.
For the quarter, public pension plans and the combination of endowments and foundations had the best performance, with both categories achieving a median return of almost 7%. Corporate plans and health and welfare plans both returned almost 4%, while Taft-Hartley plans returned almost 6%.
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Equities were the best-performing asset class for defined benefit plans in Q2, returning a median of 10.45%. Alternative investments returned more than 2%, while fixed income returned almost 2%. Real estate returns were relatively flat during the quarter.
Public plans, endowments and foundations, and Taft-Hartley plans had relatively stronger performance during the quarter due to their higher allocations to equities, according to Confluence, while corporate plans and health and welfare plans, with fixed-income-heavy portfolios, relatively underperformed other plans.
Over the most recent one-, three- and five-year periods, endowments and foundations reported the highest returns, followed by public plans. Taft-Hartley plans showed strong performance during these periods, while corporate plans and health and welfare plans saw the lowest returns over the medium-term.
Confluence, through its plan universe, tracks the performance of 4,000 institutional funds.
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Tags: Confluence
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