2023 Performance

In 2023, our US equities returned 25.17%, versus the benchmark of 19.44%.

The outperformance over the benchmark was attributable to the strong performance of the two internally managed US equity funds. The internal Large Cap US Equity Fund beat its benchmark by 804 basis points. The internal US Low Volatility Dividend Fund beat its benchmark by 642 basis points. The two index funds met their targets, exactly as expected.

The five-year return generated by our US equity program is 14.63% per year, outperforming our US equity benchmark return of 13.89% per year.

Investment Approach

Most of the Fund’s US equity assets are invested in our internally managed US Large Cap Equity Fund. This fund is benchmarked to the S&P 500 Index and primarily focuses on large cap US equities.

We manage an internal US Low Volatility Dividend Fund. It is benchmarked to the S&P 500 Low Volatility High Dividend Index. This fund is used to lower overall volatility of the US equity exposure.

We also invest 20% of the US equity assets split between two index funds. One replicates the S&P 500 return. The other replicates the midcap area of the US market.

Capital Allocation

The Fund has an 18.8% allocation to US equities, which is more than our policy benchmark target of 17.5%. The share of US stocks relative to the Fund’s total public equity allocation was 36.5% at the end of the year.

In the US equity allocation, we have 80% in large cap equities, 11.3% in midcap equities, and 8.6% in a less risky low-volatility dividend strategy.