Salient to Investors:

Wilshire Associates said US public pensions ended Q3 with a median gain of 4.67 percent as bond managers bought riskier debt and fixed-income securities with longer maturities. The median public pension was 55.5 percent in stocks, 25.7 percent in bonds, almost 3.7 percent in real estate, and 1.9 percent in alternative investments such as LBOs or distressed-bond funds, 2.5 percent in cash.

Robert Waid at Wilshire said the results give a strong message to stay the course and look to the long-term. Waid said fixed-income benchmarks, such as the Barclays index, don’t accurately reflect available opportunities because they’re heavily weighted toward US or foreign government bonds.

Junk bonds returned 4.6 percent in Q3.  High-yield company bonds have gained 13.3 percent in 2012 versus 10.4 percent for the total returns on a broad index of corporate debt.

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