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Missouri Department of Transportation & Missouri State Highway Patrol Employees’ Retirement System

(800) 270-1271

Investments

Purpose and Objectives
The primary objective of the MoDOT & Patrol Employees’ Retirement System (MPERS) is to provide active and retired employees of the Missouri Department of Transportation and the Missouri State Highway Patrol with lifetime retirement benefits.

The investment portfolio is constructed to generate a total return that, when combined with employer contributions, is sufficient to meet current and future benefit payment obligations. Following the reasonable standards for preservation of capital, the overall investment goal is to achieve the highest possible rate of return consistent with MPERS’ tolerance for risk as determined by the Board of Trustees in its role as fiduciary.

Guiding principles:
1. Preserve the long-term foundation of the fund.
2. Maximize total return within reasonable risk parameters.
3. Act in the exclusive interest of the members of the System.

Our investment beliefs:
1. Portfolio diversification is critical because the future is unknown.
2. Asset management must first focus on understanding and balancing risk.
3. Flexibility in investment policy implementation is critical because various asset classes will be in or out of favor at different points in the economic cycle.

State statutes require MPERS to make investments using the same care, skill and diligence that a reasonable person acting in a similar capacity would use. In fulfilling this obligation, the Board of Trustees has established an official investment policy to clearly define the roles and responsibilities of the Board, staff and consultants, and to ensure that the system assets are invested in a diversified portfolio following reasonable investment standards.

The Board of Trustees determines the broad asset allocation policies and return objectives of the plan and retain investment staff, consultants, a master custodian and other advisors to implement and execute these policies. The assets and the performance/return on those assets are vital to MPERS’ sustainability. While assets are used to help pay for earned member benefits and cover around 50-60% of long-term plan costs, the performance/return does not impact the amount of the benefit paid to members.