CalSTRS

CalSTRS (California State Teachers' Retirement System) strategic target allocation

CalSTRS Teachers' Retirement Board, Investment Committee · Long-term allocation adopted May 2023; targets as listed on calstrs.com at 30 September 2026

Live account on this site. This portfolio is also tracked here with a virtual $100,000 since 21.10.2026. Live account on this site →

Where it stands today

Data through 2026-09. Updated every month.

Since January+9.0 %

Last 12 months+10.9 %

Last 5 years, per year+6.3 %

Now below the peak−2.8 %

Place by 12 months26 / 60

Our calculation, 1984-02 – 2026-09

Per year9.7 %

Real (after inflation)6.6 %

Volatility11.1 %

Worst drop−41.9 %

Worst year−26.1 % (2008)

Best year30.7 %

Worst 12 months−35.8 %

Positive years83 %

4 % of this history is calculated with stand-ins for asset classes that did not exist yet (see “How we model it” and the page about data). Without stand-ins the history starts in 2000.

Growth of $10,000

CalSTRS: $511,043S&P 500: $1,163,109

Where it came from

CalSTRS calls itself the largest educator-only pension fund in the world, with about 417.7 billion dollars of investment assets at 30 September 2026. Its board publishes, on the investment portfolio page, a table with the current target, the allowed range and the actual weight for each strategic class. The targets listed on that page are: public equity 39%, fixed income 13%, real estate 15%, private equity 14%, risk mitigating strategies (RMS) 10%, inflation sensitive 7%, cash/liquidity 2%, collaborative strategies 0% and strategic overlay 0%. They sum to 100%. Ranges are plus or minus 8 points for public equity and plus or minus 5 points for the other classes (cash 0 to 5).

The policy history is told in CalSTRS's asset allocation assumptions document. In 1986 the strategic allocation was 70% equities and 30% stable assets; in 1997 the board reaffirmed 73/27; after the 2006 asset-liability study it moved to 80% equity and 20% stable. In 2009 an Inflation Sensitive class was added to improve diversification and reduce volatility, and in 2015 Risk Mitigating Strategies were added to reduce the chance of large declines in sharply negative markets. The 2019 asset-liability study continued the move to a more diversified portfolio, and the 2023 study raised private assets and raised fixed income to make room for direct lending (private credit).

In May 2023 the board adopted the new long-term mix. A trade-press summary says the stock portfolio fell by 4 points, fixed income rose by 2 points (with private debt), and private equity and inflation sensitive each rose by 1 point, with the aim of similar expected return and lower risk. That summary gives targets of 38% global equity and 14% fixed income, while the CalSTRS website now lists 39% and 13%; see uncertain.

Two of the strategic classes are not standard asset classes. RMS (target 10%) is governed by a policy revised in November 2024 whose sub-strategy targets are long-duration US Treasuries 35%, trend following 45%, global macro 15%, systematic risk premia 5% (ranges for each). The Treasury part is benchmarked to the Bloomberg US Treasury 20+ Year index and the rest are hedge-fund-style strategies meant to protect against equity downturns. Inflation Sensitive (target 7%) holds infrastructure, commodities, inflation-protected bonds, agriculture and timber, and credit; a June 2024 staff report put infrastructure at roughly 12.3 of 21.6 billion dollars of the class.

CalSTRS differs from CalPERS (which was already modelled) mainly through its much lower fixed-income share (13% against about 30% of CalPERS's 2021 policy), its 10% RMS sleeve, and its larger real-estate target (15%).

What is in it

Public equity	39%	range +/-8
Fixed income	13%	range +/-5
Real estate	15%	range +/-5
Private equity	14%	range +/-5
Risk mitigating strategies	10%	range +/-5
Inflation sensitive	7%	range +/-5
Cash / liquidity	2%	range 0-5

Source of the shares: CalSTRS Investment portfolio page (asset allocation table, as of 30 September 2026) — www.calstrs.com. Table of net asset value, actual weight, current target, difference and range per class. Actual weights then: public equity 42.75%, fixed income 12.03%, real estate 12.10%, private equity 13.77%, RMS 9.19%, inflation sensitive 7.22%, cash 0.69%, collaborative strategies 2.11%.

How we model it

US large companies (S&P 500)	23.4%
Real estate (REITs)	19%
US small companies	14%
US bond market (aggregate)	13%
Developed markets outside the US	10.9%
Cash (Treasury bills)	8.5%
Emerging markets	4.7%
Long-term government bonds (20+ y)	3.5%
Inflation-protected bonds (TIPS)	1.5%
Commodities	1.5%

Public equity 39% -> us_large 23.4 / intl_dev 10.9 / em 4.7 (60/28/12 cap-weight assumption, same as the CPP/GIC/GPIF models; CalSTRS does not publish the regional split in the sources opened). Fixed income 13% -> bond_agg. Real estate 15% -> reit. Private equity 14% -> us_small (public stand-in, as in Harvard and CalPERS). RMS 10%: the Treasury sleeve (35%) -> bond_long 3.5%; the remaining 65% (trend following, global macro, risk premia) has no series, so it is mapped to cash 6.5% (low-beta stand-in; it is not a claim that these strategies earn T-bill returns). Inflation sensitive 7% is split by our assumption: infrastructure about 57% of the class (June 2024 staff report) -> reit 4.0%; the rest equally to commodities 1.5% and tips 1.5%. Cash/liquidity 2% -> cash. Total cash 8.5%, reit 19%. The RMS and inflation-sensitive splits are our approximations, not CalSTRS numbers.

For a euro investor

The same portfolio bought with euros, without currency hedging: monthly returns converted at the end-of-month rate (German mark before 1999), inflation of the euro area. History in euros from 1984-02 to 2026-09.

Per year in euros8.4 %

After euro inflation6.1 %

Worst drop in euros−36.6 %

Worst year in euros−21.8 % (2008)

Safe withdrawal, 30 years, dollars6.76 % (1987-09)

Safe withdrawal, 30 years, euros5.15 % (1985-03)

The largest first-year withdrawal, then growing with inflation, that lasted 30 years from every monthly start. Test withdrawals for this portfolio →

How to build it with European funds

Examples of UCITS funds sold in the EU for each part of the portfolio. They track similar markets, not exactly the indices of our calculation.

Part	Share	Example funds (ISIN)
US large companies (S&P 500)	23.4%	iShares Core S&P 500 UCITS ETF USD (Acc) `IE00B5BMR087` Vanguard S&P 500 UCITS ETF (USD) Distributing `IE00B3XXRP09`
Real estate (REITs)	19%	iShares US Property Yield UCITS ETF `IE00B1FZSF77` iShares Developed Markets Property Yield UCITS ETF `IE00B1FZS350`
US small companies	14%	SPDR Russell 2000 U.S. Small Cap UCITS ETF `IE00BJ38QD84` iShares MSCI USA Small Cap ESG Enhanced CTB UCITS ETF USD (Acc) `IE00B3VWM098`
US bond market (aggregate) (closest match)	13%	iShares Core Global Aggregate Bond UCITS ETF EUR Hedged (Acc) `IE00BDBRDM35` iShares Core Global Aggregate Bond UCITS ETF USD (Dist) `IE00B3F81409`
Developed markets outside the US (closest match)	10.9%	iShares Core MSCI Europe UCITS ETF EUR (Acc) `IE00B4K48X80` iShares Core MSCI Japan IMI UCITS ETF `IE00B4L5YX21`
Cash (Treasury bills)	8.5%	Xtrackers II EUR Overnight Rate Swap UCITS ETF 1C `LU0290358497` iShares USD Treasury Bond 0-1yr UCITS ETF (Acc) `IE00BGSF1X88`
Emerging markets	4.7%	iShares Core MSCI Emerging Markets IMI UCITS ETF (Acc) `IE00BKM4GZ66`
Long-term government bonds (20+ y)	3.5%	iShares USD Treasury Bond 20+yr UCITS ETF USD (Dist) `IE00BSKRJZ44`
Inflation-protected bonds (TIPS)	1.5%	iShares USD TIPS UCITS ETF USD (Acc) `IE00B1FZSC47`
Commodities	1.5%	iShares Diversified Commodity Swap UCITS ETF `IE00BDFL4P12`

These are examples, not recommendations. Check the fund's key information document, costs and taxes with your broker before buying. Names and ISINs checked on justETF on 4 November 2026; Udak receives nothing from these funds.

The idea

Funded-status oriented portfolio built around about 80% growth-oriented assets, with two diversifiers (RMS, inflation sensitive) added in 2015 and 2009 to reduce the chance of big drawdowns in negative environments.

How people buy it

Mix of internal and external management; public equity and fixed income largely internal, large private equity, real estate and infrastructure programs through partners ('collaborative model'). Retail approximation: global equity fund, aggregate bond fund, REIT fund, a long Treasury fund and a small trend-following fund.

Rebalancing as published

Actual weights are allowed to drift inside the published ranges (public equity +/-8, others +/-5); e.g. public equity was 42.75% against a 39% target at 30 September 2026.

Variants

May 2023 trade-press version: global equity 38%, fixed income 14%, private equity 14%, inflation sensitive 7% (see uncertain).
2013 targets reported by trade press: private equity 13%, inflation sensitive 6%, fixed income 16%, global equity 51% (older policy, unverified).

Criticism

Equity-like private assets and real estate cannot be bought in index form; results of the mapped series are not comparable with the fund's reported returns.
RMS trend-following and macro strategies are only partly captured; the proxy is neutral cash.
Actual public equity ran 3.75 points above target in September 2026.

Through the eras

Era	Dates	Total	Per year	Worst drop	S&P 500
Black Monday	1987-08 – 1987-12	−15.2 %	—	−20.3 %	−21.8 %
Savings-and-loan crisis and 1990 recession	1990-07 – 1991-03	+5.7 %	—	−12.0 %	+7.4 %
1994 bond market massacre	1994-02 – 1994-12	−2.5 %	—	−4.2 %	−3.2 %
Asian and Russian financial crises	1997-07 – 1998-10	+5.2 %	+3.9 %	−13.7 %	+22.4 %
Dot-com bubble and crash	2000-03 – 2002-10	−7.3 %	−2.8 %	−12.3 %	−37.2 %
Recovery and housing boom	2002-11 – 2007-09	+115.7 %	+16.9 %	−5.2 %	+97.0 %
Global financial crisis	2007-10 – 2009-03	−36.9 %	−26.4 %	−41.9 %	−44.7 %
The decade after the crisis	2009-04 – 2019-12	+246.5 %	+12.3 %	−13.6 %	+411.2 %
Fourth-quarter 2018 sell-off	2018-09 – 2018-12	−10.3 %	—	−10.3 %	−14.4 %
Covid crash and stimulus boom	2020-02 – 2021-12	+32.6 %	+15.9 %	−16.4 %	+53.6 %
Inflation shock and rate hikes	2022-01 – 2022-12	−16.9 %	−16.9 %	−21.1 %	−19.9 %

Calendar years

Any N-year period

Any N-year period	Worst	10 % worse than	Median	10 % better than	Best
1 y (501)	−35.8 %	−3.9 %	+11.6 %	+23.1 %	+50.5 %
3 y (477)	−10.6 %	+2.5 %	+10.2 %	+15.8 %	+25.0 %
5 y (453)	−1.7 %	+4.4 %	+9.0 %	+14.1 %	+19.4 %
10 y (393)	+3.8 %	+6.5 %	+9.1 %	+11.9 %	+13.8 %
15 y (333)	+5.6 %	+7.3 %	+8.7 %	+11.5 %	+13.3 %
20 y (273)	+6.6 %	+7.6 %	+8.8 %	+11.0 %	+11.8 %
30 y (153)	+7.9 %	+8.5 %	+9.1 %	+10.1 %	+10.8 %

How it behaved in history

1986-2006. Equity share of the policy rose from 70% (1986) to 73% (1997) to 80% (2006 plan). WWW.CALSTRS.COM
2009. Inflation Sensitive class added in 2009 to improve diversification and reduce volatility. WWW.CALSTRS.COM
2015. Risk Mitigating Strategies added to limit declines in strongly negative investment periods; RMS policy first adopted 3 Feb 2016, latest revision 26 Nov 2024. calstrs.com
2023. Long-term mix cut stocks and raised fixed income (private debt), private equity and inflation sensitive. www.dakota.com

Published results (by others)

CalSTRS net investment return fiscal years 2020-21, 2023-24, 2024-25, 2025-26 (FY2021; FY2024; FY2025; FY2026 (years end 30 June)): 27.2%; 8.4%; 8.5%; 13.9% www.ai-cio.com
5-year average return 7.0% and 30-year return 7.8% (as reported at FY2026) (to 30 June 2026): 7.0%; 7.8% www.ai-cio.com

What we could not verify

Target discrepancy: Dakota (8 May 2023) lists global equity 38% / fixed income 14% for the May 2023 decision, but the CalSTRS site (30 Sept 2026) lists public equity 39% / fixed income 13% (both sum to 100%). I use the website because it is the primary and the more recent source. The official CalSTRS press release page (calstrs.com/board-adopts-new-long-term-asset-allocation) returned 404, and the Role of Strategic Classes PDF also did not open.
Regional split of public equity and the split of inflation sensitive among infrastructure, commodities, TIPS, agriculture/timber and credit are our assumptions; the 57% infrastructure share comes from a search-result summary of a June 2024 staff report that I did not open.
RMS sub-strategy targets are from the November 2024 policy (35/45/15/5); actual current sleeve weights may differ.
Fiscal-year returns for the 2008-09 and 2021-22 years were not found.
The CIO report (May 2026) gives actual weights as of 31 March 2026 but its chart labels did not extract as text, so the website table is used.

Sources

www.calstrs.com https://www.calstrs.com/investment-portfolio
calstrs.com https://calstrs.com/files/f874d0564/RiskMitigatingStrategiesInvestmentPolicy11-2024.pdf
WWW.CALSTRS.COM https://WWW.CALSTRS.COM/files/172f0026a/AssetAllocationAssumptions.pdf
www.dakota.com https://www.dakota.com/fundraising-news/calstrs-reduces-public-equity-target
www.ai-cio.com https://www.ai-cio.com/news/calstrs-earns-record-annual-return-of-27-2/
www.ai-cio.com https://www.ai-cio.com/?p=105986
calstrs-pensionx-web.specialdistrict.org https://calstrs-pensionx-web.specialdistrict.org/files/d85a1617f/INV+2026-05+-+Item+05+Pres+01.pdf
calstrs.com https://calstrs.com/files/012c8cb09/semi062024public+-+IS.pdf

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Calculated on historical data. Past results do not predict the future. Models before the 1990s use stand-ins for classes that had no index yet; fees, taxes and fund costs are not included. This is mathematics, not an investment recommendation.