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Rio Rancho permanent fund posts 6.55% Q2 return; advisers cite $14.76M market value and IPS updates
Summary
Advisers to the Rio Rancho Permanent Fund reported a 6.55% return for the second quarter, a fiscal-year gain of 11.7%, and a market value of $14,763,038 as of June 30; officials noted recent investment-policy updates and the addition of real-asset allocations.
Chad Stapleton, senior adviser at PFM Asset Management, told the Rio Rancho Permanent Fund Board the fund’s total market value was $14,763,038 as of June 30 and that the portfolio returned 6.55% in the second quarter. He said the fiscal-year return was 11.7%, roughly $1.5 million in dollar terms, and the fund’s since-inception annualized return is about 13.3%, in line with its benchmark.
Stapleton said the board’s approved investment-policy changes from an asset-allocation review in February and April are now reflected in the portfolio, including the addition of real-asset pools and adjustments to the small-cap allocation. “The target allocation is 60% equity, 40% fixed income for the portfolio,” he said, and staff implemented rebalancings during the quarter.
On contributions to performance, Stapleton cited domestic equities (domestic sleeve up 8.88% in Q2 but trailing the Russell 3000 due to the small-cap portion), international equities (up 11.24% but slightly behind the MSCI ACWI ex USA benchmark), and fixed income (up 2.31%, outperforming the Bloomberg U.S. Aggregate by roughly 100 basis points). He noted newly added real-asset pools have limited performance history and therefore show as N/A for short-term returns.
Frank McDonnell of Government Portfolio Advisors reviewed the core and liquidity portfolios. He drew attention to a more normalized yield curve and a shift in short-term rate expectations, noting that liquidity book yields fell from roughly 5.25% in 2024 to about 4.27% in the most recent quarter while the investment core book yield sat near 3.95%. McDonnell reported a swing from an earlier unrealized loss of about $1.8 million to an unrealized gain of approximately $1.3 million and said total book income rose from $11.7 million in 2024 to $12.4 million in 2025.
Board members asked no substantive follow-up questions during the presentations. Stapleton closed by inviting questions and then concluded his prepared remarks; McDonnell ended his review and left after taking questions and comments.
The presentations were delivered for board information and to support ongoing oversight of the permanent fund’s policy, allocation, and performance. No formal board action was taken on investment strategy during this meeting.
