Largest US Pension Fund CalPERS Faces Heavy Losses As Strategy Investment Drops To $80M
Key Takeaways
- CalPERS has incurred significant losses recently, with its investments dropping to $80 million from $144 million.
- This loss is manageable for CalPERS as it is less than 0.015% of CalPERS’ $556 billion assets.
- CalPERS has incurred other significant losses. CalPERS has its $468 million investment in the Clean Energy & Technology Fund (CETF), which has lost by about 71%, dropping to roughly $138 million as of March 31, 2025.
The California Public Employees’ Retirement System (CalPERS), the largest pension fund in the US, has incurred significant losses recently, with its investments dropping to $80 million from $144 million. CalPERS had acquired 448,157 Strategy (MSTR) shares in the third quarter, which were valued at $144 million. However, its value has now dropped to $80 million.
📉 Largest US Pension Fund CalPERS Faces Heavy Losses As Strategy Investment Drops To $80M
— CryptOpus (@ImCryptOpus) November 28, 2025
CalPERS’ investment in Strategy has fallen from over $144M to about $80M after the Bitcoined stock tumbled in the latest sell-off. #crypto
However, this loss is manageable for CalPERS, as it is already valued at $550 billion, with the fund managing a significant portion of the pensioners’ assets in the US.
What Caused MSTR’s Position Change?
CalPERS is a major institutional investor in MSTR’s shares. The major reason behind MSTR’s dip in value is the recent price fluctuations of Bitcoin. MSTR and Bitcoin are correlated, and any fluctuations in Bitcoin’s price will affect MSTR’s share values. That is why the value of the shares acquired by CalPERS declined by 45% from $144 million to $80 million. Warnings from other financial institutions about potential benchmark exclusions also contributed to this low valuation.
MSTR Shares’ Significance in CalPERS’ Overall Financial Health
CalPERS’ investment in MSTR, now valued at $80 million, is less than 0.015% of CalPERS’ $556 billion assets. CalPERS achieved an 11.6% net return for fiscal year 2024-25, beating its 6.8% discount rate and benchmark by 1.7%, with public equity (39% of portfolio) at 16.8% and private equity at 14.3%. Minor losses, such as what has happened now, will not have any major effect on CalPERS’ financial health.
Moreover, CalPERS is planning to move to a total portfolio approach (TPA) by July 2026. This will replace strategic asset allocation with a 75% equities: 25% bonds reference portfolio will help enhance risk management across $500+ billion worth of assets, minimizing single-stock impacts as has happened in the case of MSTR.
Broader Risks and Wins for CalPERS
Chances are high that CalPERS may face several risks and wins in its portfolio beyond the MSTR investment loss. A significant challenge for CalPERS is its $468 million investment in the Clean Energy & Technology Fund (CETF), which has lost by about 71%, dropping to roughly $138 million as of March 31, 2025. Despite this, CalPERS recorded strong overall financial performance in fiscal 2024-25, with an 11.6% return that outpaced its 6.8% discount rate. Public equities returned 16.8%, while private equity delivered 14.3%, and private debt contributed 12.8%.
The Bottom Line
CalPERS’ investment strategy is such that it can recover from such losses. CalPERS CEO Marcie Frost quotes its rebound from the losses during the pandemic as an example. The company is targeting diversification and putting 40% of its portfolio in private assets. This will make it more stable amidst all market volatilities.
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