Kentucky Retirement Systems

Investment Strategy

Kentucky Retirement Systems employs a long-term strategic asset allocation philosophy, focusing on diversified portfolios designed to achieve specific risk-adjusted returns for its various pension and insurance funds. The Trustees follow the Prudent Person Rule, balancing growth objectives with the need to protect against undue risk and short-term losses. In efficient markets, KRS utilizes low-cost index and index-like investments, while actively managing allocations, especially in less efficient markets where potential excess returns are identified. Asset allocation decisions are regularly reviewed, and the mix is dynamically adjusted based on asset-liability studies and changing market conditions. The Board prioritizes transparency, oversight, and prudent risk management, using both internal staff and external managers as appropriate.