PSERS · Pennsylvania Public School Employees' Retirement System · $85.2B
PSERS kept 89% of the profits. The fees outside that fraction are larger than the carry inside it.
PSERS reports carried interest as a split rather than a rate. Over the five calendar years to 2024 its managers took 11% of profits and the plan kept 89%, on $11.5 billion retained against $1.5 billion of carry paid. The fraction counts carry actually paid against realised profit. It does not count the $1,252 million of management fees or the $688 million of partnership expenses over the same five years. The same report answers the other half of the question too, putting value added above public-market equivalents at $6.0 billion over five years, net of everything. Nothing in Pennsylvania law required any of this. PSERS built the table itself.
Key numbers, and what they mean
89 / 11
The split over 2020 to 2024: $11,539 million retained against $1,520 million of carried interest paid. Dollar-weighted the same figures give 88.4 to 11.6; the printed 89 matches the average of the five annual percentages. PSERS does not state which it used.
1.28x
The cost outside the split against the carry inside it. Management fees of $1,252 million plus partnership expenses of $688 million over the five years, $1.94 billion in all, against $1,520 million of carried interest paid. In 2024 alone it was 1.64 times.
$6.0B
Value added above public-market equivalents over five years, net of all fees, and $9.0 billion over ten. PSERS asks what the private programme cost and what it bought, and publishes both answers. The split is only the first of them.
26% vs 4%
The manager's share of profit in infrastructure against real estate in 2024. Infrastructure returned 14.7% that year and real estate 1.2%. A small manager share usually means small profits rather than good terms.
Asset mix, September 2025
Public equity35.2%
Public fixed income26.3%
Private equity13.0%
Public real assets11.2%
Private credit7.4%
Private real assets5.0%
Cash and absolute return4.7%
Its own labels, with cash and absolute return combined. These sum to 102.8% because PSERS carries a separate explicit leverage line of negative 2.9%, against a policy target of negative 4.5%, which brings the total back to about 100%.
The read-through
From the report
Takeaway: how to apply it to a portfolio
The framing question in the report asks how much of "the realized total profit was retained by PSERS". The bullet beneath it answers "89% of profits retained by PSERS over 5 years ($11.5B), ranging from 85% in strong-performing periods to 92% in weaker-performing periods". The word realized is in the question and gone from the answer, and unrealised losses of $0.9 billion in 2024 sit outside the fraction entirely.
Write down the denominator before you write down the number. Ask four things: realised profit or total, carry paid or carry accrued, before or after management fees, and before or after partnership expenses. Note what PSERS's own range clause is telling you: the share moves with performance rather than with terms, so a high retained percentage in a bad year is not a negotiating win.
Management fees of $1,252 million and partnership expenses of $688 million over five years sit outside the split, which counts carried interest alone. The same report puts value added above public-market equivalents at $6.0 billion over five years and $9.0 billion over ten, net of all fees.
Never read a profit-split figure as a total cost figure, and never read a cost figure without a value figure beside it. Build the denominator yourself by adding management fees and partnership expenses back to profit before you compute anybody's share. Then ask the second question this report asks itself: what did the programme return against what the same money would have earned in public markets, after everything. Either number alone tells you half of what you need.
No Pennsylvania statute requires this table. PSERS adopted its own investment transparency policy in December 2019, and "has made the ILPA reporting template (or comparable template) a mandatory term for all private manager contracts approved by the PSERB since May 2016".
The lever is the contract, not the legislature. A family office cannot pass a disclosure law, but it can decline to sign without a fee and expense template, and it can specify that carry paid and carry accrued be reported as separate lines. An $85 billion plan got this by making it a condition of doing business, which means it has to be agreed before the money moves rather than requested afterwards.
The Argus lensWhat a fund may charge the fund, how carry is calculated and when it may be taken are all settled in the agreement long before any of it appears in a report. Reading those clauses, and telling you what the resulting numbers will and will not include, is the work we do.
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About the source
PSERS publishes an annual private markets fee review to its board. The review for calendar 2024 was presented to the investment committee on 23 October 2025 and gives, for the private programme and for each asset class, the profit and loss, the management fees, the partnership expenses, the carried interest split between paid and accrued, and the resulting division of profit between the plan and its managers, over five years. It also reports the value added against public-market equivalents over five and ten years. Private markets net asset value was $26.3 billion at 31 December 2024. The asset mix is from its allocation report at 30 September 2025.