2 Ways Exotic Stocks Impacts Texas TRS Pension System.

• In 2007 TRS Board voted to invest 10% of its assets in emerging markets during a period of economic prosperity
  • One of the investments was a Turkish steel company now “in the crosshairs of President Donald Trump.”
  • The vote opened up investments in these countries:
    • Brazil
    • Russia
    • India
    • China
    • Mexico
    • South Africa
    • Turkey
• Created a structural investment probelm in TRS in that professional investors “can rush in and out of emerging-market stocks when market sentiment shifts”, TRS cannot so easily

The investments have returned 1.1%

Other state pensions did this like NY and CA, what made TRS different? TRS devoted 10% of its assets, in contract CA capped it at 4%

The Street | In Texas, Teachers See Savings Eroded by Bad Bets on Exotic Stocks