Key takeaways:

• The persistent gender wage gap widened slightly in 2025; women were paid 18.6% less than men on average after controlling for race and ethnicity, education, age, marital status, and state.
• Women are paid less than men across all education levels. Women with a graduate degree earn less, on average, than men with only a college degree.

• The gender pay gap worsened following a year of Trump administration attacks on workers, including cuts to the federal workforce; attacks on diversity, equity, and inclusion efforts; ordering mass deportations; and undermining child care and home care providers.
• States can narrow the gender pay gap with policies that guarantee access to paid family and medical leave, mandate pay transparency, raise the minimum wage, and make it easier for workers to form unions.

March 26 is Equal Pay Day, a reminder that there is still a significant pay gap between men and women in our country. The date represents how far into 2026 women would have to work on top of the hours they worked in 2025 simply to match what men were paid in 2025.

On an hourly basis, women were paid 18.6% less on average than men in 2025, after controlling for race and ethnicity, education, age, marital status, and state. After narrowing to a series low of 18.0% in 2024—likely driven by a strong labor market recovery from the COVID-19 recession that lifted wages more at the lower end of the overall wage distribution—the gender wage gap widened slightly in 2025. Though far from a total reversal of the last few years’ progress, the slight worsening in 2025 reflects the slowing of low-end wage growth and the economic consequences of Trump’s first year back in office.

Women are paid less than men due to discrimination associated with occupational segregation, devaluation of women’s work, and societal norms, much of which takes root well before women enter the labor market. The wage gap is smallest among lower-wage workers partly because the minimum wage creates a wage floor. At the 10th percentile, women are paid $1.39 (or 9.1%) less an hour than men, while the wage gap at the middle is $4.12 an hour (or 14.7%). Women at the 90th percentile of their wage distribution are paid $14.05 (or 19.6%) less an hour than men at the 90th percentile of the wage distribution.

Women are paid less than men at every education level

Although women have seen gains in educational attainment over the last five decades, they still face a significant wage gap. Among workers, women slightly outnumber men in the college-educated labor force and are significantly more likely to obtain a graduate degree than men. Even so, women are paid less than men at every education level, as shown in Figure A.

Figure A

Among workers who have only a high school diploma, women are paid 21.5% less than men. Among workers who have a college degree, women are paid 23.8% less than men. That gap of $12.07 per hour translates to roughly $25,100 lower annual earnings for a full-time worker. Women with an advanced degree also experience a significant hourly wage gap of $17.70 in 2025, amounting to over $36,800 annually.

What the data makes very clear is that women cannot educate themselves out of the gender wage gap. Systemic inequities are so persistent that women with advanced degrees are paid less per hour, on average, than men with only college degrees. Men with a college degree only are paid $50.61 per hour on average compared with $49.67 for women with an advanced degree.

Black and Hispanic women experience the largest wage gaps

For Black and Hispanic women, the pay gaps relative to white men are even larger due to compounded discrimination and occupational segregation based on both gender and race/ethnicity. In Figure B, we compare middle wages—or the 50th percentile of each group’s wage distribution—for Asian American/Pacific Islander (AAPI), Black, Hispanic, and white women with that of white men.1

White and AAPI women are paid 81.9% and 93.3%, respectively, of the amount non-Hispanic white men are paid. Black women are paid only 68.3% of white men’s wages at the middle, down from 69.6% in 2024. This is a gap of $9.87 on an hourly basis, which translates to roughly $20,500 lower annual earnings for a full-time worker. For Hispanic women, the gap is even larger: Hispanic women are paid only 64.5% of white men’s wages, an hourly wage gap of $11.06. For a full-time worker, that gap is over $23,000 a year. This disparity has also risen slightly compared with last year.

Figure B

Even when controlling for age, education, marital status, and state of residence, Black and Hispanic women are paid 25.3% and 27.4% less than their white male counterparts, respectively. In other words, very little of the observed difference in pay is explained by differences in education, experience, or regional economic conditions.

Trump administration policies exacerbate lower pay and make it harder to enforce antidiscrimination laws

Over the last year, the Trump administration has repeatedly taken actions that harm women workers, including:

• slashing the federal workforce;
• weaponizing agencies meant to defend workers and combat discrimination by turning them into defenders of discriminatory practices;
• eliminating enforcement of race- and gender-based equal employment practices for federal contractors;
• ordering mass deportations;
• undermining child care providers and vital state funds;
• limiting access to funding for higher education;
• rolling back protections for home care workers; and
• normalizing harassment and retaliation in the workplace.

Black and Hispanic women have endured and will continue to suffer the consequences of these attacks more intensely than many of their white, non-Hispanic male colleagues. Trump’s reckless decimation of the federal workforce, for instance, has disproportionately affected Black women, for whom government jobs have historically been a powerful tool for economic mobility and security. In 2025, Black women’s employment rate fell by 1.4 percentage points to 55.7%. This is one of the sharpest one-year declines in the last 25 years and is a much more dramatic drop than that of other women or Black men. College-educated Black women experienced the largest drop in employment, likely because nearly half of Black federal government workers have a bachelor’s degree or higher. This drop in well-paid, traditionally stable jobs will almost certainly lead to increased economic insecurity. Additionally, mass deportations will likely reduce jobs for both immigrant and U.S.-born women, particularly in the care sector, disproportionately impacting Hispanic women.

The Trump administration has also stifled the government’s ability to protect workers and penalize discriminatory employers. The restriction of the use of words like “gender,” “race,” “equity,” and “discrimination,” and attempts to weaponize the Equal Employment Opportunity Commission (EEOC) against women and workers of color will harm all workers, while weakening our ability to track pay equity and enforce nondiscrimination laws. Staffing levels at the EEOC have fallen steadily over the last four decades, but recent funding cuts and shifting priorities will exacerbate its already reduced capacity for enforcement. There have also been ongoing threats to the availability and continued collection of key data throughout federal agencies. If agencies that collect data on wages and incomes by demographic characteristics pull back, it would be a disaster for anyone—policymakers, researchers, employers, or workers—who wants basic facts about how well the economy is performing for different workers and different sectors.

Despite federal threats, states can help close the gender pay gap

Closing pay gaps by gender and by race and ethnicity will require policy solutions on multiple fronts. Although attacks on gender and racial equity continue at the federal level, state lawmakers can and must take steps to address the gender wage gap. Potential solutions include enacting pay transparency laws, mandating Paid Family and Medical Leave (PFML), raising the minimum wage, funding universal child care, and removing anti-worker, so-called “right-to-work” (RTW) statutes. Figure C highlights the states that have already passed some of these critical pieces of legislation, while underscoring the need for strong federal standards to cover the millions of workers who live outside of these states.

Figure C

Only 14 states have mandatory, comprehensive PFML policies, even though they provide essential benefits that help workers maintain their livelihoods while taking care of themselves and their families. Studies show that access to PFML improves outcomes for parents and children, workforce participation, and job retention, and that this a beneficial policy for both employees and employers. Access to paid leave is also shown to bridge racial gaps in care and pay.

Pay transparency laws are another useful tool that prevents employers from offering unequal pay by requiring them to include wage information in job postings. While there is some variation in laws, all include some requirement that employers provide salary information in job postings, but employers in Connecticut, Maryland, and Rhode Island only must furnish that information if requested by applicants. This wage transparency has the potential to reduce gender-based discrimination by arming jobseekers with more information and limiting employers’ ability to pay different amounts to similarly qualified candidates. A Colorado pay transparency law, for example, reduced gender wage gaps for workers who changed jobs by as much as 8.9%.

Policymakers effectively stopped protecting workers’ rights to form unions and bargain collectively starting in the 1980s, resulting in less leverage for workers and increased income inequality. Weak labor law allows employers to retaliate against union organizing and undermine workers’ right to collectively bargain. Union contracts can help narrow gender and racial wage gaps by providing clear wages for a given level of experience and education, reducing employers’ ability to discriminate in wage setting. Unfortunately, 26 states have RTW laws that make it even harder for unions to effectively organize and bargain for better contracts. States with these laws not only have lower unionization rates but also have wider gender wage gaps. By making it easier for workers to form unions, policymakers can help reduce these pay gaps.

The minimum wage keeps wages from falling below a mandated floor. While the real value of the federal minimum wage has been allowed to decline, down nearly $5 an hour since its peak in 1968, states have stepped in and increased their minimum wage. As of January 2026, 30 states and D.C. have minimum wages higher than the federal minimum, covering more than half of U.S. workers. Since women are disproportionately found in the low-wage workforce, these laws are key to increasing their economic security and narrowing wage gaps at the lower end of the wage distribution.

Although there is no single policy that will close the wage gap, each of these solutions will narrow it and improve conditions for workers across the country. In his first year back in office, Trump has rolled back critical labor standards, decimated federal unions, and laid off tens of thousands of federal workers. Now, more than ever, it is critical that states step up to protect workers under attack, prevent the gender wage gap from expanding, and build an equitable economy that works for all. 

1. Race/ethnicity categories are mutually exclusive in this analysis. Here we denote white to mean white non-Hispanic, Black is Black non-Hispanic, Asian American/Pacific Islander (AAPI) are AAPI non-Hispanic, and Hispanic refers to Hispanic of any race.

 Sarah Rundell of Top1000Funds reports on how CalSTRS' One Fund approach navigates uncertainty:

Scott Chan is shocked the market hasn’t reacted more to the crisis emulating from the US-Israel-Iran conflict. But the CalSTRS CIO is confident its one fund approach allows it to position dynamically and ensure diversification no matter what is presented.

So warned CalSTRS’ CIO Scott Chan speaking at the $392 billion pension fund’s March investment committee meeting, explaining to trustees that many unknowns lie below that will impact global trade flows, the equity bull market, and in the shape of currents like AI and America’s burgeoning housing crisis, young people’s ability to tap into the American dream.

The impact of the conflict in Iran is also gathering force below the surface of an apparently benign market.

Chan said he “was shocked” that the market hasn’t reacted more to the crisis – notwithstanding the sharp rise in oil prices. He attributed the absence of a market reaction to enduring uncertainty of how events will play out.

“The market is pricing efficiently what it knows,” he said, adding: “Right now with the uncertainty, I don’t care who you talk to, if they tell you they know what’s going to happen, you should probably walk the other way.”

In the first few weeks of the conflict, CalSTRS strategy has involved rebalancing from its slight overweight to growth assets, ensuring “ample” liquidity and staying mindful of emerging opportunities. For example, the energy crisis potentially opens the door to investment opportunities in markets that are net importers of oil through the Strait of Hormuz like India, Japan, China and South Korea, where sharp falls in the KOSPI represented a potential buying opportunity.

Away from geopolitics, Chan noted other currents building like trends in fiscal policy intervention and the formation of new trade alliances that are rewriting supply chains and redirecting how capital flows. As governments grapple to manage huge deficits, he flagged the risk and opportunity in interest rate volatility and the importance of diversification, discipline and staying dynamic.

Reflecting on market impacts closer to home, Stephen McCourt, managing principle and co-CEO, Meketa, argued that new Fed chair Keven Warsh won’t necessarily push for lower rates. “If Trump’s interest is to get the Fed to lower interest rates irrespective of data, Warsh is an unusual selection.” Coupled with inflationary concerns, he said it explains why markets have priced in fewer rate cuts for 2026.

Chan said the CalSTRS’ One Fund approach, its version of a total portfolio approach, will support the investor’s demand to dynamically allocate and diversify to maximise returns in the current complex environment. It allows the team to invest tactically to position the portfolio to benefit from volatility and has required putting in place cultural and organisational structures, notably a total fund team that maps a common language of risk, and how portfolio risk is shifting.

Recent strategies include increasing capital to asset backed private credit that is less cyclical, more stable and adds diversification with a similar return to other forms of private credit. Elsewhere, strategies include rebalancing the portfolio and pursuing opportunities when the markets are discounted.

CalSTRS generated an unofficial 13 per cent return over the last calendar year, well above the 7 per cent actuarial goal, with the value of the portfolio increasing by $42.5 billion, net of fees, contributions and benefits.

The global equity portfolio rose 22.8 per cent, led by strong non-U.S. equity market performance and interest rates fell, driving strong performance in fixed income markets.

The $58.8 billion private equity portfolio yielded a positive return over the past six months and outperformed the Custom State Street Index, which is used to evaluate performance against other institutional investors.  Staff have increased co-investments, which now represent 24.6 per cent of the private equity allocation and continue to work toward the goal of 33 per cent co-investments. 

Clearly, CalSTRS is doing well, and here CIO Scott Chan explains how their One fund approach dynamically allocates and diversifies to maximize returns in the current complex environment. 

[...] It allows the team to invest tactically to position the portfolio to benefit from volatility and has required putting in place cultural and organisational structures, notably a total fund team that maps a common language of risk, and how portfolio risk is shifting.

Recent strategies include increasing capital to asset backed private credit that is less cyclical, more stable and adds diversification with a similar return to other forms of private credit. Elsewhere, strategies include rebalancing the portfolio and pursuing opportunities when the markets are discounted.

Whatever they are doing, it's working, CalSTRS delivered a gain of 13% over the last calendar year, outperforming its large Canadian peers (but underperforming Norway's giant sovereign wealth fund which gained 15.1% in 2025).

Again, it's all about asset allocation and CalSTRS is more exposed to liquid public markets (similar to Norway's Fund) but also has a sizable private equity/ private markets portfolio which seems to be performing relatively well. 

Again, outperfoming its required rate of return (7%) by 600 basis points last calendar year is nothing to sneeze at, but keep in mind, their fiscal year ends at June 30 , so these are not official returns.

No doubt, their One Fund approach is proving very useful in this environment and they managed to diversify globally properly to take advantage of opportunities.

So, kudos to CalSTRS, Scott Chan, and his investment and risk teams, they're executing nicely in a difficult environment.

Moreover, for the 11th time, CalSTRS has been named one of the Best Places to Work in Money Management by Pensions & Investments magazine:

This 14th annual survey and recognition program is dedicated to identifying and honoring the top employers in the money management industry.

“As their employees attest, the companies named to this year’s Best Places to Work list demonstrate a commitment to building and maintaining a strong workplace culture,’’ Pensions & Investments Editor-in-Chief Julie Tatge said. “In doing so, they’re helping their employees, clients and businesses succeed.’’ 

The Best Places to Work award winners are chosen based on workplace policies, practices, philosophy, systems and demographics, as well as an employee survey.

“We’re honored to receive this award, which is a testament to our team’s commitment to protect the more than 1 million California public educators and beneficiaries who rely on us to help secure their future,” CalSTRS Chief Executive Officer Cassandra Lichnock said. “The award affirms that our greatest asset is our innovative, inclusive and passionate workforce.”

"This is an acknowledgement of the amazing teamwork and passion of our investments team and our colleagues across the organization,” CalSTRS Chief Investment Officer Scott Chan said. “I'm so grateful to the team for embracing our organization's mission and continuing to strive for innovation and collaboration.”

The 2025 Best Places to Work in Money Management award winners are posted online.

Good for them, this is a well-deserved acknowledgement.

Below, in this episode of How I Invest, a conversation with Scott Chan, Chief Investment Officer of CalSTRS, to explore how he oversees a staggering $350 billion in assets (March 2025). 

Scott shares insights on CalSTRS’ collaborative investment model, their approach to private and public markets, and why they aim to be the "global partner of choice." He also discusses the importance of structural alpha, liquidity management, and identifying long-term supply-demand imbalances.

Great discussion, listen carefully to his insights and approach. 

Key takeaways:

• Ballot initiatives have enabled voters to advance worker-centered policies—like higher minimum wages—in states with hostile legislatures, particularly in the South.
• A coordinated, right-wing legislative attack on ballot initiative processes is attempting to reverse ballot initiative wins, scare advocates out of using the ballot process, and make it harder to get future measures on the ballot that improve standards for workers.
• Despite these barriers, advocates and voters are fighting back to protect pro-worker ballot access and advance new progressive ballot measures.

In recent years, state ballot initiatives have served as powerful tools to advance economic opportunity for working families. Voters directly have raised the minimum wage, secured paid sick leave, protected abortion access, enacted bail reform, expanded Medicaid, and increased funding for public education—all popular progressive economic policies that some state legislatures have failed to enact. However, some conservative state legislatures have responded by overturning or limiting recent wins. And in the few Southern states where voters can access ballot measures—Arkansas, Florida, and Oklahoma—conservative legislators are waging war against the ballot initiative process itself, attempting to obstruct the will of voters and make it permanently more difficult for the public to directly decide on policy choices.

Why ballot initiatives are important for advancing economic opportunity

Ballot initiatives are a form of direct democracy in which voters have the power to decide on a proposed new law or constitutional amendment. Currently, 26 states and the District of Columbia offer voters access to ballot measures in some form, as do many more localities.

While more than half of the country has access to some form of direct democracy, ballot access is heavily concentrated in Western and Northern states. Only three states in the Deep South—Arkansas, Florida, and Oklahoma—effectively have ballot initiative processes. Attacks on the ballot process are intensifying in each of these states.

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Ballot initiatives are more important than ever for advancing worker-centered policies that both Congress and state legislatures have failed to enact despite clear voter support. For example, Republican lawmakers have repeatedly blocked legislative proposals to increase the minimum wage (federally and in many states) despite the popularity of increasing the minimum wage and the positive impacts it has on workers and families. In the absence of federal action, 30 states, the District of Columbia, and almost 70 localities have adopted minimum wages above the federal minimum of $7.25 per hour. Of these states, 43% (13 states) used ballot measures to secure the increase. An additional three states used direct democracy to increase minimum wages that already exceeded the federal floor.

Ballot measures have been especially critical to achieving minimum wage increases in Southern states like Arkansas and Florida. Only four other states in the South—Delaware, Maryland, Virginia, and West Virginia—have increased their minimum wages via legislation likely due to higher minimum wages in neighboring states or Democratic legislative majorities.

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Paid leave laws have remained similarly scarce across the South. Of the 18 states with some form of statewide paid sick leave, only one—Maryland—is in the South. Attempts to expand paid leave access in Southern states have so far been limited to narrow state legislation covering only some public employees, or local efforts threatened with state preemption, demonstrating the need for ballot initiatives.  

Right-wing attempts to weaken direct democracy in the South

In response to the success of progressive ballot measures, right-wing lawmakers have launched attacks on direct democracy, particularly in the South.  

Opponents of ballot access have especially targeted the signature process to delay or block measures from reaching the ballot. This strategy arose in Mississippi via a court challenge to a 2020 ballot initiative allowing the use of medical marijuana, which 74% of voters approved. As advocates including the Mississippi NAACP were building support for new ballot measures to expand Medicaid, the courts struck down the ballot process. Even though Mississippi’s Constitution guarantees voters access to ballot initiatives, the state Supreme Court ruled that no ballot initiative could be valid because of outdated constitutional language establishing the signature rules. (The old rules do not account for the lower number of congressional districts in Mississippi after redistricting, making it impossible to reach the signature threshold to put a measure on the ballot.)  

Following the Mississippi blueprint, direct democracy opponents in other Southern states have begun to challenge the signature process. After Arkansas voters passed minimum wage increases through ballot measures, the Arkansas legislature passed new state laws that could empower the state attorney general to invalidate a request for signatures because of the title of the measure. If and when the signature process begins, a host of laws make it much more difficult for canvassers to collect signatures. Canvassers must now confirm the voter reads the ballot title, inform voters that petition fraud is a crime, check voter identification, and file an affidavit stating they have complied with all laws. Scare tactics directed at both petition canvassers and signers make it harder to collect signatures out of fear that exercising their constitutional rights may lead to imprisonment.

Following minimum wage increases that passed via ballot measures, the Florida legislature followed a similar strategy of restricting the signature process for citizen-led constitutional amendments. Their legislation excludes people with felonies, people without citizenship, and non-Florida residents from being canvassers. It also requires canvassers to register with the state or face a third-degree felony charge which could be punishable by up to five years in prison. Once the signatures are collected, the law also requires the sponsor to deliver the petitions within 10 days after a voter signs, as opposed to once all signatures are collected. These restrictions deeply limit the number of people who can collect signatures and add burdensome labor to the petition sponsor by requiring frequent trips to deliver the petitions. In 2025, advocates met the signature threshold to put recreational cannabis on the ballot, but the new laws invalidated over 70,000 signatures and prevented the measure from reaching voters.  

Finally, conservative lawmakers in Oklahoma have launched attacks on the ballot process. Oklahoma organizers have already secured the signatures for a 2026 ballot measure to increase the minimum wage. In response, lawmakers attacked the signature process, restricting the share of eligible voters who can sign initiative petitions per county and consequently weakening the influence of voters in the most populous counties like Oklahoma and Tulsa counties. The Oklahoma Policy Institute explains that this new requirement would “exclude 2.2 million registered voters (or 94.4% of registered voters) from signing a petition for statutory amendments.” The restriction also has racial implications with Tulsa County home to 23% of Black Oklahomans and Oklahoma County home to 41% of Black Oklahomans. Compounding the new restrictions, the law also gives the secretary of state the authority to determine the legality of a proposal. The new law also requires that paid petitioners disclose their employer to the secretary of state and prohibits paying canvassers with out-of-state funding or based on the amount of signatures they collect, among other tactics to invoke fear.

Overall, these new petition processes can make signature collection more costly due to administrative barriers that only allow the most well-funded campaigns to have any chance of making the ballot. Consequently, the process now lends itself to causes backed by corporate interests or wealthy supporters which may not reflect the needs of average voters, contradicting the goals of ballot access policies intended to democratize decision-making.

Despite attacks, voters are still fighting to launch ballot initiative campaigns and protect direct democracy

Despite growing attacks on the ballot process, organizing across the country—and in the South—persists. In June 2026, Oklahoma State Question 832 will be on the ballot, proposing to gradually increase the minimum wage to $15 per hour by 2029. In Florida, ballot measures proposing various constitutional amendments are moving forward to expand Medicaid, legalize recreational use of marijuana, and codify the right to clean and healthy water.

Advocates are also organizing to protect the constitutional right to ballot access itself. Arkansas Public Policy Panel and the Protect AR Rights coalition continue to fight back and win against new restrictions on ballot measures, filing lawsuits and proposing a new ballot question that would make ballot access a “fundamental right.” Their new ballot question was approved in July 2025, clearing one of the last barriers for signature collection. In Oklahoma, advocates have filed two lawsuits opposing new restrictions on ballot measures—especially the state’s ability to disrupt the signature collection process—and are awaiting a decision from the state’s Supreme Court.

Voters are similarly fighting back in states where legislators have rolled back successful pro-worker ballot measures. In response to the Nebraska legislature weakening a new paid sick leave law won via ballot measure, the Respect Nebraska Voters coalition is organizing for a new ballot measure to make it more difficult for the legislature to reverse the will of voters. Missouri legislators repealed parts of a successful ballot measure that established paid sick leave and attached a cost-of-living increase to the minimum wage. Voter outrage over the legislative betrayal has “kicked the hornet’s nest,” according to the bipartisan Respect Missouri Voters coalition, which recently submitted over 20 versions of new petitions to protect ballot initiatives. If implemented, these petitions would require an 80% legislative majority to overturn a successful ballot initiative law or constitutional amendment, prohibit barriers to signature collection, allow corrections to misleading ballot language, and add other ballot protections.

The essence of ballot access is the will of the people becoming law. Despite legislative efforts to obstruct direct democracy, Southern advocates and voters continue to push for the voice of everyday people to be heard and for policies that improve the lives of workers and their family members.

Mary McDougall and Alexandra Heal of the Financial Times report Canadian pension funds count cost of private equity slump:

A number of Canada’s biggest investors lost money on their private equity holdings last year as a downturn in the buyout sector continued to weigh on returns at some of the world’s largest retirement funds.

Ontario Teachers’ Pension Plan, which manages C$279bn ($206bn) of assets, and the C$145bn Ontario Municipal Employees Retirement System reported returns of minus 5.3 per cent and minus 2.5 per cent respectively for their private equity portfolios in 2025. For OTPP, it was the worst performance for this asset class since 2008 and for Omers since 2020.

La Caisse, Quebec’s C$517bn state pension fund, also reported weak private equity results. The group said its PE portfolio returned 2.3 per cent last year, well below the 12.6 per cent gain in its benchmark index, half of which is made up of listed stocks.

The Healthcare of Ontario Pension Plan, which published results this week alongside OTPP, reported private equity returns of 3.6 per cent in 2025. Its broader private markets portfolio returned 2.1 per cent, compared with 11.7 per cent for its listed holdings.

“Those are pretty dismal numbers, in private equity returns should be at 15 per cent minimum,” said one Canadian pension investor.

Rising interest rates since 2022 have weighed on private equity investment, with higher borrowing costs hitting dealmaking, returns and exit options.

Canada’s pension system is a major private equity investor with more than 20 per cent of public sector pension money allocated to the asset class, according to think-tank New Financial.

Dale Burgess, executive managing director of equities at OTPP, said private equity investors had been “navigating increased cost of capital, more constrained exit markets and greater operating complexity, creating a drag on returns”.

OTPP’s PE portfolio dropped in value from C$60.4bn to C$50.8bn last year, partly driven by full or partial sales of its investments in insurance brokerage BroadStreet Partners, Indian hospital chain Sahyadri Hospitals and Canadian retirement home provider Amica Senior Lifestyles.

To address the challenges, OTPP said it had made a “strategic shift” towards investing in areas where it believes it has a competitive edge, particularly the financial, services and technology sectors.

Omers said its C$25.6bn private equity portfolio had a net investment loss of C$700mn last year, with challenges in its industrial holdings and “weak performance across our earlier-stage growth and venture portfolios”. In recent months Omers has announced sales in its private equity portfolio including California-based care manager Paradigm and Toronto-based home care business CBI Health.

La Caisse blamed its disappointing private equity results on “slow earnings growth for portfolio companies and lower multiples in the technology and healthcare sectors”.

Overall returns across the pension companies were boosted by buoyant stock markets last year. OTPP’s total portfolio net return was 6.7 per cent, compared with 6 per cent for Omers and 9.3 per cent for La Caisse.

A quick note on the paltry returns in PE portfolios of some of Canada's Maple 8 funds (from the ones that reported thus far).

Last week, I spoke with OTPP's former CEO Jim Leech and asked him point-blank: "What's going on with OTPP's PE portfolio?"

Jim was in good spirits. He had just come back from skiing with his grandchildren in British Columbia and told me: "I don't know. All I can tell you is there is a lot more competition nowadays compared to when I was heading up Teachers' Private Capital." 

From my vantage point, covering all these pension plans/ funds, clearly 2025 wasn't a great year in Private Equity, and it wasn't a particularly great year in private markets.

Jim Leech is right, the game has changed significantly, there's way too much competition in private equity and that has spread to infrastructure, real estate and private credit.

Alternatives used to be a niche market, now there’s not much "nichiness" going on. Everyone is doing the same thing, the big giants keep raising bigger funds, and everyone is waiting for some serious financial crisis (aka dislocation in the markets) to put a lot of dry powder to work.

All I know is there is reason to be concerned, the Maple 8 funds shifted billions collectively into private markets over the last 20 years and that game seems stale these days.

Private Equity remains an important asset class but there are a lot of discussions taking place at these large shops.

If you underperform your benchmark over one year or even three years, it's a tough pill to swallow but you'll survive. 

If you underperform your benchmark in PE for 5 years, you're in deep trouble.

I'm not sure the situation is that dire, but it's definitely not the best of times for private markets, especially private equity and real estate.

Things might be slowly changing for the better -- I think they are -- but investors are anxious and worried.

Don't forget, in Canada, the whole "raison d'etre" of shifting into private markets was to manage more internally and add value without paying excessive fees.

If you can't deliver there, your whole "value add" proposition is in trouble.

Still, I don't want to take one or two bad years and extrapolate. I think there's a lot of generalizing going on in private equity/ private credit and I want to be very careful because the level of pessimism is a bit absurd in my opinion.

Private equity stocks are finally popping this week, too soon to tell whether they're turning the corner and headed back up for good but I'm paying attention.

All this to say, no doubt, private equity is in a slump but it's not dying and going away, that's just plain silly.

Does the industry need a good shakeout? You bet, it's already underway.

The dispersion of returns of top PE funds and top private credit funds with bottom ones has grown considerably over the last few years. 

Only the best will survive and that's the way it should be.  

Below, private equity returned fewer profits to investors for a fourth straight year as the industry sat on $3.8 trillion of unsold assets and struggled to raise money for new funds. Bloomberg's Allison McNeely reports (watch this clip here as I cannot embed it below).

Also, Orlando Bravo, founder and managing partner of Thoma Bravo, sits down with CNBC's Leslie Picker to discuss the impacts of artificial intelligence on the software sector.

Third, KKR Co-CEO, Scott Nuttall discusses the firm’s evolution into a diversified global investment platform and its dealmaking priorities with Bloomberg’s Dani Burger at Bloomberg Invest 2026 in New York.

Fourth, Ares Management Corporation Co-Founder & CEO, Michael Arougheti, discusses the private credit cycle, firm growth and the push to expand access beyond traditional institutional investors. He spoke with Bloomberg’s Dani Burger at Bloomberg Invest 2026 in New York.

Lastly, Apollo Global Management Inc. Chief Executive Officer Marc Rowan warned that a shakeout is coming for private credit firms as the industry faces a wave of concerns about rising defaults on loans to software companies.

For weeks, private credit executives have faced questions from investors over whether the $1.8 trillion industry can withstand sustained pressure if the software sector is upended by artificial intelligence in the coming years. Rowan’s comments came as business development companies have been hit by redemptions in recent weeks amid those broader investor concerns.

“This will be a shakeout — I don’t think it is going to be short term,” Rowan said in an interview with Bloomberg News Editor-in-Chief John Micklethwait at Bloomberg Invest in New York. “It was foreseeable. It was predictable. And all you can do is have been a good underwriter, a good risk manager, have done a small number of stupid things.”

Monte Stewart of Canada CRE News reports Sagard, La Caisse are investing $490M in US-based IOS Properties:

Sagard Real Estate and La Caisse are launching a partnership to invest about $490 million in industrial outdoor-storage properties across major U.S. infill markets.

The partnership will pursue an industrial outdoor storage (IOS) strategy focused on key U.S. seaport markets where tenant demand is driven by proximity to major ports, population centres and trade infrastructure, said the companies. Priority markets include Southern California, the greater New York City and northern New Jersey region, the San Francisco Bay Area, Houston, and the Baltimore–Washington, D.C., metropolitan area.

The initiative brings together Sagard Real Estate (SRE), a U.S.-based real estate investment advisor and subsidiary of Montreal-based Sagard, and La Caisse. The partnership has an initial target gross asset value of CAD 490 million (US$360 million), with the option to scale through additional commitments.

“Our partnership with Sagard enables us to create a dedicated IOS platform that strengthens our real estate portfolio construction strategy through diversification into alternative sectors,” said Rana Ghorayeb, executive vice-president and head of real estate at La Caisse. “IOS is a critical supply chain asset class, benefiting from strong structural tailwinds: E-commerce growth, global trade, and nearshoring. By leveraging Sagard’s fully integrated regional teams and proven off-market sourcing capabilities, we gain privileged access to high-quality opportunities.”

Sagard Real Estate President Mark Bigarel said the organizations worked closely to develop the strategy and target markets.

“This partnership brings together two like-minded organizations with aligned values and complementary strengths,” he said. “With La Caisse’s scale and long-term vision, combined with our operator-driven expertise, we are well-positioned to capture compelling opportunities in markets with strong fundamentals and durable demand drivers.”

The partnership has completed its first acquisition in the Meadowlands submarket serving the greater New York City area. The fully leased IOS property functions as an operational hub with strong connectivity to Manhattan and the Port of New York and New Jersey.

“Our IOS program focuses on some of the most strategically important U.S. logistics and trade markets, and this first closing directly advances our investment objectives,” said Chad Messer, deputy CIO and portfolio manager at Sagard Real Estate. “With limited supply and high demand for well-located outdoor-storage facilities near major seaports and population hubs, we believe this strategy is uniquely positioned to generate attractive, risk-adjusted returns through disciplined sourcing, value creation, and active management.”

Sagard Real Estate said the partnership reflects both organizations’ commitment to building a scalable IOS platform across major U.S. port and population-centre markets, supported by long-term capital and durable demand fundamentals. 

Nolan Keegan of Hoodline also reports big-money yard grab hits Meadowlands as Sagard, La Caisse roll out $360M storage play:

Two heavyweight investors are teaming up to turn unglamorous pavement into a serious cash play. Sagard Real Estate and La Caisse have launched a new U.S. joint venture aimed at buying and operating industrial outdoor storage yards near major ports, with an initial gross asset target of CAD 490 million (about USD 360 million) and a first deal already inked in the Meadowlands submarket. The focus is on fenced, paved yard space used by contractors, trailer operators and equipment fleets at a time when infill land near key seaports is getting scarce. Executives are pitching the strategy as a way to lock in steady income from a niche corner of the logistics chain where well-located sites are hard to find.

In a company release, Sagard Real Estate said the partnership will target Southern California, the greater New York City and northern New Jersey region, the San Francisco Bay Area, Houston and Baltimore/Washington, D.C., and that the joint venture can expand further if additional capital is committed, according to Sagard Real Estate. La Caisse, the Quebec pension giant that reported net assets of CAD 517 billion as of Dec. 31, 2025, is serving as the strategic capital partner in the vehicle, per La Caisse.

Why yard space is suddenly a prime asset

Executives describe industrial outdoor storage, or IOS, as a structural investment play tied to the rise of e-commerce, global trade flows and nearshoring, all colliding with a finite supply of infill yard sites near big population centers and ports. "IOS is a critical supply chain asset class, benefiting from strong structural tailwinds - e‑commerce growth, global trade, and nearshoring," said Rana Ghorayeb, La Caisse’s head of real estate, in the companies' announcement via Sagard Real Estate. Sagard added that the partnership will lean heavily on regional sourcing and off-market access as the backbone of its value-creation strategy.

First Meadowlands deal plants the flag

The joint venture’s debut purchase is a fully leased IOS hub in the densely built-out Meadowlands submarket serving the greater New York City area. The partners say the property’s strong connectivity to Manhattan and the Port of New York and New Jersey underpins long-term structural demand for the site. Industry coverage has highlighted the CAD 490 million (roughly USD 360 million) initial target for the program and noted that the partners have not released detailed information about the specific location, according to Bisnow.

Local fallout: better yards, tougher land markets

Institutional buyers can upgrade yard operations with improvements like paving, lighting and security, but their arrival can also tighten local land markets and fuel community pushback over truck trips and shifting land uses. That tension is already apparent in Southern California, where investors have been converting underused parcels and flex properties into IOS yards, according to goes all in on industrial storage land grab coverage and a MacLeod & Co. market report that points to tight supply and rising per-acre pricing.

What this means for other port cities

Because the joint venture includes an option to scale, industry watchers expect more acquisitions in major seaport markets and even fiercer competition for infill industrial land, according to observers cited by Bisnow. For the full details on the strategy and initial rollout, see the companies’ press announcement and the original distribution via WebWire and the firms’ releases. 

Last week, La Caisse issued a press release stating it is launching an industrial outdoor storage joint venture strategy with Sagard Real Estate:

Sagard Real Estate (SRE), a leading U.S.-based real estate investment advisor and subsidiary of Sagard, a global multi-strategy alternative asset management firm, and La Caisse (formerly CDPQ), a global investment group, today announced the launch of a new partnership focused on an Industrial Outdoor Storage (IOS) strategy across major U.S. infill markets, with an initial target gross asset value of CAD 490M (USD 360M) and the option to scale the partnership through further commitments.

This partnership between two major Québec institutions will deploy an IOS strategy focused on key U.S. seaport markets where strong tenant demand is driven by proximity to major ports, population centers, and trade infrastructure. Priority markets include Southern California, greater New York City/northern New Jersey, the San Francisco Bay Area, Houston, and the Baltimore/Washington, D.C., metropolitan area.

“Our partnership with Sagard enables us to create a dedicated IOS platform that strengthens our real estate portfolio construction strategy through diversification into alternative sectors,” said Rana Ghorayeb, Executive Vice-President and Head of Real Estate at La Caisse. “IOS is a critical supply chain asset class, benefiting from strong structural tailwinds—e-commerce growth, global trade, and nearshoring. By leveraging Sagard’s fully integrated regional teams and proven off-market sourcing capabilities, we gain privileged access to high-quality opportunities.”

“We are proud to partner with La Caisse on this new IOS strategy. Our teams have worked closely to define the markets, lifecycle, and we look forward to executing on this together,” said Mark Bigarel, President of Sagard Real Estate. “This partnership brings together two like-minded institutions with aligned values and complementary strengths. With La Caisse’s scale and long-term vision, combined with our operator-driven expertise, we are well-positioned to capture compelling opportunities in markets with strong fundamentals and durable demand drivers.”

The partnership has closed its first acquisition, an IOS investment in the highly infill Meadowlands sub-market, serving the greater New York City area. The location of the fully leased operational hub offers strong connectivity to Manhattan and the Port of New York and New Jersey, supporting long-term structural demand.

“Our IOS program focuses on some of the most strategically important U.S. logistics and trade markets, and this first closing directly advances our investment objectives,” said Chad Messer, Deputy CIO and Portfolio Manager, Sagard Real Estate. “With limited supply and high demand for well-located outdoor storage facilities near major seaports and population hubs, we believe this strategy is uniquely positioned to generate attractive, risk-adjusted returns through disciplined sourcing, value creation, and active management.”

The partnership affirms Sagard Real Estate and La Caisse’s commitment to advancing IOS across major U.S. port and population-center markets, establishing a scalable platform supported by long-term capital and durable demand fundamentals.

ABOUT SAGARD REAL ESTATE

Sagard Real Estate is a real estate investment advisor and operator providing investment management services throughout the U.S., including portfolio management, acquisitions, debt origination, asset management, development, and property management for investors. With US$6.0 billion in assets under management, Sagard Real Estate offers commercial real estate investment strategies through separate accounts and commingled funds. Founded in 1997, the firm is headquartered in Denver and maintains regional investment offices in New York City, Charlotte, Austin, Los Angeles, and San Francisco metro areas. Sagard Real Estate is a part of Sagard, a multi-strategy alternative asset management firm.

For more information, visit www.sagard.com/realestate or follow us on LinkedIn.

ABOUT SAGARD

Sagard is a global multi-strategy alternative asset management firm with more than US$33B under management1, 190 portfolio companies, and 440 professionals.

We invest in venture capital, private equity, private credit, and real estate. We deliver flexible capital, an entrepreneurial culture, and a global network of investors, commercial partners, advisors, and value creation experts. Our dynamic and supportive ecosystem gives our partners the advantage they need to learn, grow and win at every stage. The firm has offices in Canada, the United States, Europe and the Middle East.

For more information, visit www.sagard.com or follow us on LinkedIn.

1As of September 30, 2025

ABOUT LA CAISSE

At La Caisse, formerly CDPQ, we have invested for 60 years with a dual mandate: generate optimal long-term returns for our 48 depositors, who represent over 6 million Quebecers, and contribute to Québec’s economic development.

As a global investment group, we’re active in the major financial markets, private equity, infrastructure, real estate and private credit. As at December 31, 2025, La Caisse’s net assets totalled CAD 517 billion. For more information, visit lacaisse.com or consult our LinkedIn or Instagram pages.

Alright, it's Monday, most people are off in Ontario, Alberta and British Columbia this week, so I expect it to be quiet in the pension world (not in markets).

This joint venture between Sagard Real Estate and La Caisse caught my attention last week for two reasons.

First, last September, I wrote about how OTPP is launching a JV with Sagard Real Estate to invest in US industrial properties.

The real estate subsidiary of Sagard is now launching a joint venture with La Caisse focused on an Industrial Outdoor Storage (IOS) strategy across major US infill markets, with an initial target gross asset value of CAD 490M (USD 360M) and the option to scale the partnership through further commitments. 

Clearly, Sagard Real Estate is attracting top Canadian pension funds because of its expertise and experience in traditional and niche strategies.

Second, I like this strategy because instead of playing pure logistics, it's more defensive and really deals with the scarcity of land issue near major ports. From the second article:

The focus is on fenced, paved yard space used by contractors, trailer operators and equipment fleets at a time when infill land near key seaports is getting scarce. Executives are pitching the strategy as a way to lock in steady income from a niche corner of the logistics chain where well-located sites are hard to find. 

The article also states:

Institutional buyers can upgrade yard operations with improvements like paving, lighting and security, but their arrival can also tighten local land markets and fuel community pushback over truck trips and shifting land uses.

But La Caisse and Sagard Real Estate both espouse sustainable investing and I doubt you'll see community pushback.

In short, I like this joint venture because if it's done correctly, you can realize great risk-adjusted returns in this Industrial Outdoor Storage (IOS) space. 

As Rana Ghorayeb, Executive Vice-President and Head of Real Estate at La Caisse states in the press release:  

“IOS is a critical supply chain asset class, benefiting from strong structural tailwinds—e-commerce growth, global trade, and nearshoring. By leveraging Sagard’s fully integrated regional teams and proven off-market sourcing capabilities, we gain privileged access to high-quality opportunities.” 

I also like what Chad Messer, Deputy CIO and Portfolio Manager, Sagard Real Estate

“Our IOS program focuses on some of the most strategically important U.S. logistics and trade markets, and this first closing directly advances our investment objectives. With limited supply and high demand for well-located outdoor storage facilities near major seaports and population hubs, we believe this strategy is uniquely positioned to generate attractive, risk-adjusted returns through disciplined sourcing, value creation, and active management.” 

There you have it, it's all about generating great risk-adjusted returns during volatile and uncertain times.

Lastly, speaking of volatile and uncertain times, earlier today I learned Iran hit key UAE oil port and Dubai airport.

Keep in mind, La Caisse invested US$2.5 billion in 2022 to acquire stakes in DP World’s key Dubai assets, including the Jebel Ali Port, Jebel Ali Free Zone, and National Industries Park. This partnership made CDPQ a major partner in the Middle East's largest port. 

I hope the people working there are safe and these assets were not hit in these strikes but clearly we are now seeing the risk of war on key infrastructure assets in that region.

Below, in this epsiode of The Weekly Take from CBRE, Spencer Levy explores the world of Industrial Outdoor Storage (IOS) with Brian Fiumara & Myles Harnden from CBRE and Nick Firth from Industrial Outdoor Ventures. From its unique benefits and challenges to capital markets and pricing, environmental and regulatory concerns, and future outlook, get the inside scoop on this exciting new asset class.

Also, Industrial Outdoor Storage (IOS) is booming, a discussion with expert Vytas Norusis, Senior Valuation Services Director at Colliers.

Discover a wealth of free wallet patterns in PDF format, perfect for DIY enthusiasts! Explore options ranging from simple cardholders to convertible purse designs, readily available online.

The Growing Popularity of DIY Wallets

Handmade wallets are experiencing a surge in popularity, driven by a desire for unique, personalized accessories and a growing maker movement. Free wallet patterns, particularly those available as downloadable PDFs, are fueling this trend, offering accessible projects for crafters of all skill levels.

Individuals are increasingly drawn to the satisfaction of creating functional items themselves, moving away from mass-produced goods. PDF patterns provide a convenient and cost-effective way to access designs, eliminating shipping costs and allowing for immediate project starts.

The availability of diverse patterns – from minimalist cardholders to complex designs accommodating phones and passports – caters to varied needs and preferences, further boosting the appeal of DIY wallet making.

Why Choose a PDF Pattern?

PDF wallet patterns offer unparalleled convenience and accessibility for crafters. Instant download means you can begin your project immediately, bypassing shipping delays and costs. These digital patterns are universally compatible, printable at home, or viewable on any device, offering flexibility.

Furthermore, PDF formats often include detailed instructions and diagrams, guiding you through each step of the construction process. Many designers provide patterns with multiple size options and customization suggestions.

Choosing a PDF pattern empowers you to learn new skills, experiment with materials, and create a truly personalized wallet tailored to your exact needs and style preferences.

Exploring Available Free Wallet Patterns

Numerous free wallet patterns are accessible online, including designs by Ragnar and Spencer Ogg, catering to various skill levels and crafting preferences.

Ragnar’s Curved Card Wallet Pattern

Ragnar offers a simple, curved card wallet pattern, meticulously crafted without reverse engineering. This pattern distinguishes itself with four distinct sizing options – 2.7mm, 3.0mm, 3.38mm, and 3.85mm spacing – allowing for personalized adjustments. The T-pocket width is dynamically adjusted based on the chosen spacing.

Importantly, the provided STL files lack explicit instructions or stitch lines, acknowledging the subjective nature of these elements based on individual preferences. Extra bodies are included within the STL files to aid in cutouts and alignment, though users are advised to verify file integrity before commencing leatherwork. The pattern is freely available via a WeTransfer link.

Pattern Sizes and Spacing Options (2.7mm, 3.0mm, 3.38mm, 3.85mm)

Ragnar’s pattern provides exceptional flexibility through its four distinct spacing options: 2.7mm, 3.0mm, 3.38mm, and 3.85mm. This allows crafters to tailor the wallet’s dimensions to their preferred card arrangement and overall aesthetic. The width of the T-pockets is intelligently linked to each spacing multiplier, ensuring a snug and secure fit for cards.

Choosing the correct spacing is crucial for optimal functionality. Experimenting with each size allows for a personalized wallet experience, accommodating varying card thicknesses and desired pocket tightness. This detailed sizing system sets Ragnar’s pattern apart, offering a refined level of customization.

STL Files and Customization Considerations

The provided STL files include supplementary bodies designed to aid in precise cutouts and accurate alignment during leather preparation. These additions streamline the crafting process, minimizing errors and ensuring professional-looking results. However, it’s vital to thoroughly inspect the files before commencing any cutting.

Please note that the creator assumes no responsibility for potential errors arising during the export process. Customization is encouraged, but careful verification of the STL files remains the user’s responsibility. Remember, no stitch lines are included, allowing for personalized sewing preferences.

Beginner-Friendly Card Wallet Sewing Pattern

For those new to sewing, a readily available free PDF pattern offers an excellent starting point. This pattern prioritizes simplicity, focusing on fundamental techniques ideal for building confidence. Step-by-step video tutorials often accompany these patterns, providing visual guidance throughout the construction process.

Spencer Ogg Sewing Patterns provides a particularly accessible design – a two-pocket wallet perfect for cash and cards. These beginner-friendly resources empower crafters to create functional and stylish wallets with minimal prior experience, fostering a rewarding DIY journey.

Focus on Simplicity for New Sewers

Beginner wallet patterns emphasize straightforward construction, minimizing complex steps and intricate designs. These patterns typically utilize fewer pattern pieces and rely on basic sewing techniques like straight stitching. Clear, concise instructions and accompanying visuals are crucial, guiding new sewers through each stage of the process.

The goal is to build confidence and skill, allowing novices to successfully complete a project and experience the satisfaction of creating a functional accessory. Simplicity ensures a less daunting experience, encouraging continued exploration of sewing crafts.

Scrap Buster Leather Wallet Pattern

Leather scrap projects offer a sustainable and economical approach to wallet making. These patterns are specifically designed to utilize smaller pieces of leather often leftover from larger projects, minimizing waste and maximizing resourcefulness. Scrap buster designs frequently feature simpler constructions, ideal for utilizing varying leather thicknesses and textures.

This is a fantastic way to experiment with different leather finishes without significant investment. Patterns often prioritize functionality over elaborate detailing, resulting in practical and eco-conscious wallets.

Utilizing Leather Scraps for Sustainable Crafting

Embrace eco-friendly crafting by transforming leather scraps into stylish and functional wallets! This practice minimizes waste, offering a sustainable alternative to purchasing new leather for each project. Scrap leather wallets often showcase unique textures and color combinations, adding character to each piece.

By creatively repurposing materials, you contribute to a circular economy and reduce your environmental footprint. These projects are perfect for beginners, allowing experimentation with different techniques and designs without significant material cost.

Spencer Ogg Sewing Patterns: Coin Purse/Wallet

Explore Spencer Ogg Sewing Patterns’ free PDF pattern for a versatile coin purse or wallet! This design features a practical two-pocket layout, comfortably accommodating cash and cards. Remarkably, it’s also sized to fit a standard mobile phone and even a passport, increasing its utility.

The pattern includes comprehensive instructions and accompanying YouTube tutorials, ensuring a smooth and enjoyable sewing experience. Ideal for both beginners and experienced crafters, this pattern offers a quick and rewarding project with a functional outcome.

Two-Pocket Design for Cash and Cards

This Spencer Ogg Sewing Patterns wallet boasts a thoughtfully designed two-pocket system, specifically crafted for optimal organization. One pocket securely holds folded cash, while the second is perfectly sized for essential cards – credit cards, identification, or loyalty programs.

The pockets’ dimensions ensure a snug yet accessible fit, preventing items from slipping out during daily use. This simple yet effective design prioritizes functionality, making it an ideal choice for those seeking a streamlined and practical wallet solution. It’s a core feature of this free PDF pattern!

Mobile Phone and Passport Compatibility

Beyond just cash and cards, the Spencer Ogg Sewing Patterns wallet offers surprising versatility! The design accommodates a standard-sized mobile phone, providing a secure and convenient carry solution for those on the go. Imagine consolidating your essentials into one compact accessory.

Remarkably, this wallet also fits a passport, making it an excellent travel companion. This feature eliminates the need for a separate passport holder, streamlining your travel preparations. The free PDF pattern allows for a surprisingly spacious interior, cleverly designed for modern needs!

Advanced Wallet Pattern Features

Explore innovative designs like cork wallet variations and convertible purse/wallet options with detachable straps, elevating your crafting projects!

Cork Wallet Variations & Matching Sets

Delve into the world of cork wallet crafting, discovering tutorials for creating larger and more sophisticated designs. Consider expanding your project beyond a single wallet by exploring options for coordinating matching sets. This allows for a cohesive and stylish accessory collection.

Specifically, the “Bigger and Better Cork Wallets” tutorial offers guidance on scaling up your designs. This is ideal for those seeking increased capacity or a more substantial aesthetic. Creating matching sets—perhaps a wallet, cardholder, and key chain—adds a personalized touch and makes for thoughtful gifts.

Cork provides a unique texture and sustainable alternative to traditional leather, offering a distinctive look and feel.

Bigger and Better Cork Wallets Tutorial

Explore a dedicated tutorial focused on crafting larger cork wallets, expanding beyond basic designs. This resource provides detailed instructions for achieving a more substantial and functional accessory. The tutorial caters to crafters seeking increased capacity for cards, cash, and even mobile phones.

It guides you through the process of adapting existing patterns or creating new ones specifically tailored for cork material. Learn techniques for working with cork’s unique properties, ensuring durability and a professional finish.

This tutorial is perfect for those wanting to elevate their cork wallet projects and create truly impressive pieces.

Convertible Purse/Wallet Designs

Discover innovative wallet patterns that seamlessly transform into compact purses! These designs offer ultimate versatility, adapting to your needs with detachable strap functionality. Enjoy the convenience of a streamlined wallet for everyday use, quickly converting to a hands-free purse when required.

Free PDF patterns often include detailed instructions for attaching and detaching straps, ensuring a secure and stylish transition. Explore options with varying strap lengths and attachment methods to personalize your convertible accessory.

Embrace the flexibility of a two-in-one design!

Detachable Strap Functionality

Explore the clever design element of detachable straps in convertible wallet patterns! These patterns prioritize adaptability, allowing you to switch effortlessly between a compact wallet and a convenient purse. Free PDF downloads often showcase various strap attachment methods, including snaps, clasps, or loops.

Benefit from the freedom to carry essentials hands-free or stow the strap for a minimalist profile. Many patterns offer adjustable strap lengths for customized comfort. This feature enhances the wallet’s practicality, making it ideal for travel or daily commutes.

Resources for Pattern Download & Tutorials

Find numerous websites offering free wallet patterns in PDF format, alongside helpful YouTube tutorials demonstrating construction techniques for various designs.

Free PDF Pattern Download Locations

Numerous online platforms host free wallet patterns in convenient PDF format. Websites like WeTransfer (we.tl/t-EWn7fuDLWd) provide direct access to patterns like Ragnar’s curved card wallet. Spencer Ogg Sewing Patterns offers a free coin purse/wallet pattern with detailed instructions. Searching online for “wallet sewing pattern” or “DIY wallet pattern free” yields a plethora of results, including beginner-friendly options and scrap-buster designs.

Additionally, exploring designer websites and online crafting communities often reveals exclusive freebies. Remember to always verify the source and download responsibly, ensuring the file is safe before opening it. These resources empower crafters to create stylish and functional wallets without any upfront cost.

YouTube Video Tutorials for Visual Guidance

Complementing the free PDF wallet patterns, numerous YouTube tutorials offer step-by-step visual guidance. Spencer Ogg Sewing Patterns provides a video tutorial alongside their free coin purse/wallet pattern, simplifying the construction process. These videos demonstrate cutting techniques, sewing methods, and assembly procedures, ideal for beginners.

Searching “wallet sewing tutorial” or specific pattern names on YouTube reveals a wealth of instructional content. Visual learners benefit greatly from observing the techniques firsthand, enhancing understanding and confidence. These tutorials often cover troubleshooting common issues and offer customization tips, maximizing the value of your free pattern.

Materials Needed for Wallet Construction

Essential materials include leather (various types & thicknesses), needles, thread, cutting tools, and potentially cork for variations – all to bring your free PDF pattern to life!

Leather Types and Thickness Recommendations

Selecting the right leather is crucial for a durable and aesthetically pleasing wallet. For beginners utilizing free PDF patterns, vegetable-tanned leather is highly recommended due to its ease of tooling and finishing.

Thickness varies depending on the desired wallet style. Card wallets generally benefit from 2.0mm – 2.4mm leather, providing sufficient structure without excessive bulk. For more substantial wallets accommodating phones or passports, consider 2.8mm – 3.5mm leather.

Scrap leather is excellent for practice and smaller projects, aligning with “scrap buster” patterns. Always ensure the leather is free of blemishes and has a consistent thickness throughout the piece for optimal results when following your chosen free PDF pattern.

Sewing Supplies: Needles, Thread, and Tools

Essential supplies are key to successfully crafting a wallet from a free PDF pattern. A leather sewing needle – specifically a diamond point – is vital for piercing the material cleanly. Polyester thread, known for its strength and durability, is preferred over cotton.

Tools include a rotary cutter or sharp utility knife for precise leather cutting, a metal ruler for straight edges, and an awl for pre-punching stitch holes. A mallet aids in setting snaps or rivets.

Edge bevelers and slickers enhance the wallet’s finish. Remember to select tools appropriate for the leather thickness specified in your chosen free pattern.

Construction Techniques

Master precise cutting and assembly of leather pieces, following your free PDF wallet pattern. Durable sewing techniques, like saddle stitching, ensure a long-lasting finish.

Cutting and Assembling Leather Pieces

Precise cutting is paramount when working with your downloaded free wallet pattern PDF. Carefully transfer the pattern pieces onto your chosen leather, utilizing a sharp utility knife or rotary cutter for clean lines. Remember to account for seam allowances, if not already included in the pattern.

Accuracy during cutting directly impacts the final product’s appearance and functionality. After cutting, dry-fit the pieces together to ensure proper alignment before committing to any permanent joining methods. Use leather cement or glue sparingly to temporarily hold pieces in place during assembly.

Pay close attention to the orientation of the leather grain, as this can affect the wallet’s durability and aesthetic appeal. Consistent pressure during gluing and clamping will create strong, lasting bonds.

Sewing Techniques for Wallet Durability

Robust stitching is crucial for a long-lasting wallet crafted from a free PDF pattern. Employ a saddle stitch – a hand-sewing technique – for superior strength and a professional finish. Alternatively, use a sewing machine with heavy-duty thread and a leather needle.

Backstitching at the beginning and end of each seam reinforces the stitching and prevents unraveling. Maintain consistent stitch length and tension throughout the sewing process. Consider edge finishing techniques, like edge painting or burnishing, to seal the leather edges and prevent wear.

Reinforce stress points, such as corners and card slots, with additional stitching or rivets for enhanced durability.

Customization Options

Personalize your wallet using a free PDF pattern! Add embellishments, linings, or adjust sizes to create a unique and functional accessory reflecting your style.

Adding Personal Touches: Embellishments & Linings

Elevate your free PDF wallet project with creative embellishments! Consider adding decorative stitching, rivets, or even small leather appliques for a unique flair. Experiment with different lining fabrics – cotton, felt, or even patterned materials – to not only enhance the aesthetic but also provide added durability and structure.

Linings can also conceal raw edges and offer a more polished finish. Don’t be afraid to explore contrasting colors or textures to make your wallet truly stand out. Remember, a free pattern is a canvas for your imagination; personalize it to reflect your individual style and preferences!

Adjusting Pattern Sizes for Individual Needs

Utilizing a free wallet pattern PDF doesn’t mean you’re locked into a single size! Many patterns, like those offering multiple spacing options (2.7mm, 3.0mm, 3.38mm, 3.85mm), provide a foundation for customization. If you require a larger or smaller wallet, carefully scale the pattern during printing, ensuring proportional adjustments are made to all components.

Consider the dimensions of your cards and cash when making alterations. For matching sets, explore tutorials like “Bigger and Better Cork Wallets” for guidance on size variations. Remember to test the adjusted pattern with scrap material before cutting into your final leather!

Troubleshooting Common Issues

Address STL file errors by double-checking exports before cutting. Leather cutting challenges can be overcome with sharp tools and careful pattern alignment.

Addressing Errors in STL Files

Encountering issues with STL files is common when working with digital patterns. Before committing to cutting your leather, meticulously inspect the downloaded file. The creator notes that they cannot be held responsible for export errors, emphasizing the importance of self-verification. Look for gaps, overlaps, or distorted shapes within the file preview.

If discrepancies are found, consider re-downloading the file or attempting to open it in a different STL viewer. Sometimes, software compatibility can cause rendering problems. Remember, a flawed STL file will translate into an inaccurate cut, potentially ruining your material. Prioritize careful examination to ensure a successful project!

Dealing with Leather Cutting Challenges

Cutting leather accurately requires sharp tools and a steady hand. When using patterns, ensure they are securely adhered to the leather to prevent shifting during cutting. For intricate designs, a rotary cutter can provide cleaner lines than a traditional knife, especially with thinner leathers.

Be mindful of leather grain direction; cutting against the grain can lead to stretching or uneven edges. If you’re new to leatherwork, practice on scrap pieces first to refine your technique. Patience is key – rushing can result in mistakes. Utilize the extra bodies included in some STL files for alignment assistance.

Where to Find More Patterns

Explore online communities, forums, and designer websites for additional free wallet patterns and inspiration to expand your crafting possibilities!

Online Communities and Forums

Engage with fellow crafting enthusiasts in vibrant online communities and forums dedicated to sewing and leatherwork. These platforms are treasure troves of shared knowledge, offering access to numerous free wallet patterns often not found elsewhere. Members frequently share their own designs, modifications, and helpful tips for successful construction.

Participate in discussions, ask questions, and showcase your completed projects to receive valuable feedback and inspiration. Websites like Reddit (specifically subreddits focused on leathercraft or sewing) and dedicated crafting forums provide a supportive environment for learning and discovering new patterns. Don’t hesitate to search within these communities using keywords like “free wallet pattern PDF” to uncover hidden gems!

Designer Websites Offering Freebies

Many independent designers generously offer free wallet patterns in PDF format as a way to showcase their skills and attract customers. Spencer Ogg Sewing Patterns, for example, provides a free pattern for a two-pocket coin purse/wallet, complete with instructions and a video tutorial.

Explore websites specializing in sewing patterns; often, they feature a section dedicated to free downloads. Regularly check these sites, as freebies are often time-limited promotions. Searching directly for designers offering “free wallet pattern PDF” can yield excellent results, leading you to unique and high-quality designs.

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Freschia Gonzalez of Benefits and Pensions Monitor reports OPTrust marks 30 years with 17th straight fully funded result:

Seventeen years of full funding and three decades in operation put OPTrust in a small club of Canadian defined benefit plans that have delivered on their promises through multiple market cycles. 

OPTrust’s 2025 Funded Status Report, Service & Security – Since 1995, confirms the OPSEU Pension Plan remained fully funded for the 17th consecutive year. On a funding basis at 31 December 2025, the Plan reported an actuarial value of assets of $27.9bn against liabilities of $27.7bn, for a surplus of $199m. 

Financial‑statement figures show net assets available for benefits of $27.2bn, pension obligations of $22.5bn and an accounting surplus of $4.7bn. 

The funding valuation uses a 2.80 percent real discount rate (4.80 percent nominal), down from 2.90 percent (4.90 percent nominal) in 2024. That change alone added about $562m to liabilities, but OPTrust still held its fully funded position. 

The valuation also identified $708m in deferred investment losses to be recognised over four years, using asset smoothing to support stability in future valuations. 

On the asset side, OPTrust posted a 4.2 percent net Total Portfolio return in 2025.  

The five‑year average net return stands at 6.3 percent, the 10‑year at 6.7 percent, and the since‑inception average at 7.8 percent. Investment returns now account for more than 70 percent of the benefits OPTrust pays to members when they retire. 

Peter Lindley, president and chief executive officer of OPTrust, said that “in a year shaped by economic uncertainty and geopolitical tensions,” the Plan’s results reflected its diversified investment approach. 

He said their role as a long‑term investor allows them to “look beyond short‑term uncertainty” and focus on keeping the Plan sustainable over the decades ahead. 

The asset mix pairs a large illiquid allocation with a sizeable liquid book. Illiquid assets – private equity, infrastructure, real estate and an incubation portfolio – represented 54.2 percent of the portfolio and returned ‑0.8 percent in 2025, but 10.4 percent over five years and 12.3 percent over 10 years.  

Within that, private equity (18.7 percent of assets) returned 4.6 percent, infrastructure (17.9 percent) 1.9 percent and real estate (16.9 percent) ‑8.5 percent. 

Liquid assets accounted for 61.2 percent of the portfolio and returned 10.5 percent. Government bonds (27.3 percent) returned 0.8 percent. Public equity (16.6 percent) delivered 18.2 percent, credit (3.2 percent) 5.7 percent, Absolute Return Strategies (8.0 percent) 9.7 percent and commodities (6.1 percent) 45.0 percent, reflecting strong gold performance.  

The Funding Portfolio, which manages liquidity and uses moderate leverage, showed a weight of ‑15.4 percent, indicating balance sheet leverage at the total‑fund level. 

2025 also marked the first full year of a structural shift in public markets. OPTrust combined eight separate programmes into a single Liquid Completion Portfolio under its Member‑Driven Investing strategy, its version of a Total Portfolio Approach.  

The new portfolio, managed centrally by the Total Portfolio Management group, returned 20.3 percent and generated $1.6bn in profits in its first year. 

On the liability side, the report shows 117,895 members and retirees at year‑end: 55,510 active members, 17,962 former members with entitlements and 44,423 pensioners.  

Active members had an average age of 43.4 and average salary of $78,563. Retirees had an average age of 74.5 and received an average annual pension of $25,636.  

In 2025, OPTrust paid $1,417m in benefits and received $716m in contributions. 

The 2025 cost‑of‑living adjustment was 2.0 percent for both the primary schedule and OPTrust Select. 

Under the primary schedule, pensions in pay and deferred pensions automatically receive inflation adjustments.  

Under OPTrust Select, the Board may grant inflation‑related increases on a discretionary basis. 

According to the report, a retiree who started a $20,000 pension in January 1995 would receive $38,059 starting January 2026, a 90 percent increase over 31 years. 

Service metrics remained strong. Members rated OPTrust’s service 8.6 out of 10 in 2025, and CEM Benchmarking ranked the organisation among the top 10 pension plans globally for service.  

The Member Experience and Pension Operations team handled about 48,000 phone calls and supported roughly 73,500 life events, while recalculating benefits for about 61,000 members and former members who received retroactive salary increases dating back to 2022. 

Responsible investing and climate remain embedded in the strategy.  

OPTrust reports that it met all 2025 targets under its climate change strategy, now four years into a net‑zero‑aligned program launched in 2022.  

Between 2023 and 2024, the Plan achieved a 23 percent reduction in its carbon footprint through decarbonisation in several carbon‑intensive assets and changes in portfolio composition.  

In 2025, OPTrust voted at 700 company meetings in 30 countries, engaged 104 companies in 28 countries on ESG issues, and completed the fourth year of its COMPAS ESG data program to support investment monitoring and stewardship. 

Lindley said OPTrust was set up 30 years ago “to pay pensions today and preserve pensions for tomorrow.” He said the plan has been fully funded for 17 consecutive years and serves 118,000 members in retirement.  

On Wednesday, OPTrust released its 2025 Funded Status Report, stating it was fully funded for 17th consecutive year:

TORONTO, March 11, 2026 — Today, OPTrust released its 2025 Funded Status Report — Service & Security – Since 1995 — which details the Plan's financial results and funded status, while marking its 30th anniversary. In 2025, OPTrust remained fully funded for the 17th consecutive year and achieved a net investment return of 4.2 per cent. Over the past 10 years, the Plan's average net investment return is 6.7 per cent.

“Thirty years ago, OPTrust was founded with a mission to pay pensions today, and preserve pensions for tomorrow,” said Peter Lindley, President and CEO of OPTrust. “As OPTrust remains fully funded for the 17th consecutive year, we continue to fulfil that purpose for our 118,000 members, delivering income security and peace of mind in retirement.”

Since starting operations in 1995, OPTrust’s membership has grown by more than 70 per cent, and assets have increased nearly fivefold. Today, investment returns account for more than 70 per cent of the benefits paid to OPTrust members when they retire, with over $1.4 billion in entitlements paid in 2025. The Plan’s average annual net investment return since inception is 7.8 per cent.

“In a year shaped by economic uncertainty and geopolitical tensions, the continued strength of the Plan is a testament to our diversified investment strategy guided by an experienced investment team,” said Lindley. “Our perspective as a long-term investor allows us to look beyond short-term uncertainty, and to stay focused on the sustainability of the Plan over the decades to come.”

OPTrust continues to provide exceptional service to members, who rated their service satisfaction as 8.6 out of 10. The Plan was recognized among the top 10 pension plans globally for service by CEM Benchmarking Inc.'s annual rankings.

Find more information about OPTrust's 2025 strategy and results in Service & Security – Since 1995 at optrust.com.

About OPTrust

With net assets of over $27 billion, OPTrust invests and manages one of Canada's largest pension funds and administers the OPSEU Pension Plan (including OPTrust Select), a defined benefit plan with 118,000 members. OPTrust was established to give plan members and the Government of Ontario an equal voice in the administration of the Plan and the investment of its assets through joint trusteeship. OPTrust is governed by a 10-member Board of Trustees, five of whom are appointed by OPSEU/SEFPO and five by the Government of Ontario.

 Before I get to my discussion with James Davis, some high-level comments.

First, a message from Chair Richard Nesbitt and Vice-Chair Ram Selvarajah:

 

I note:

The Board continues to oversee OPTrust’s five-year strategic plan, now in its fourth year. The transformation of our pension administration system and processes through the PATH initiative is progressing well and remains on track for rollout in 2027. We are also advancing our climate change strategy, now four years in, with climate considerations integrated into core investment processes as part of our ambition to achieve a net-zero portfolio by 2050.

Modernization efforts across the organization — including the thoughtful use of AI tools — are strengthening our capabilities and enhancing collaboration in a hybrid work environment. At the same time, we are investing in our people, fostering learning and career growth to build a durable foundation for the decades ahead. 

Next, a message from CEO Peter Lindley:

I note the following (shorter version form here):

Thirty years ago, OPTrust was founded with a clear purpose: to provide secure, reliable pensions for our members. Today, that purpose remains unchanged, though the world around us has evolved dramatically.

Navigating a complex landscape

The past year has been shaped by economic uncertainty and geopolitical tensions that continue to influence markets and the Canadian economy. In this environment, resilience matters. OPTrust is fully funded for the 17th consecutive year, consistent with our long-term objectives.

Putting members first

Our members count on us for more than investment performance – they trust us for guidance and support through every stage of their careers and into retirement. We are advancing the modernization of our pension administration system to continue supporting our members now and into the future. This modernization project, called PATH, will transform how we serve them.

Building for the future

We are in the fourth year of our five-year strategic plan, seeing strong progress in enhancing Plan sustainability, investing in our people and strengthening our capabilities. In an ever-changing world, being strategic means embracing innovation in a thoughtful way. We are piloting AI tools to enhance efficiency and collaboration, with careful attention to governance and security. Combined with modernization efforts like PATH, these initiatives are creating a stronger, more agile organization that is ready to meet the needs of tomorrow. 

“I am proud of what OPTrust has accomplished and energized by what lies ahead. Our focus remains clear: delivering pensions today and preserving pensions for tomorrow. That commitment has guided us for 30 years, and it will continue to guide us for decades to come.” -- Peter Lindley

Next, some highlights from OPTrust's 2025 year:

 Here are the membership statistics for OPTrust:

The key thing here is that the ratio of active to retired workers is 1.25 so OPTrust is a more mature plan and needs to manage risks more closely.

The real discount rate dropped in 2025 from 2.9% to 2.8%, "reflecting a more conservative estimate
of investment returns, adds prudence to the funding assumptions, helping to ensure the Plan will be ready to tackle future challenges":

The following from pages 22 and 23 of the 2025 Funded Status Report are very important to read and understand because it situates readers on their member-driven investment journey and philosophy and why they implemented a total portfolio approach across public markets last year:

 

Worth noting this:

The early impact of the new model was evident in 2025 results. The Liquid Completion Portfolio generated a 20.3 per cent return, delivering $1.6 billion in total profits in the first year of implementation. 

The plan's total portfolio performance is best gauged over a longer period, returning 6.7% annualized over a 10-year period:

And the table below shows OPTrust's asset mix and returns by asset class as at the end of 2025:

As you can see, 54.2% of the assets are in illiquid private markets and 61.2% in liquid (public) markets (doesn't add up to 100% because they used leverage in liquid markets).

Real estate had a tough year, and James and I discussed this below, but strong returns in public equity, commodities and absolute return strategies helped them post a positive return. 

Lastly, OPTrust manages 74% of its assets internally to reduce costs and is well diversified internationally but also has excellent domestic exposure:

Alright, I provided a good overview of the key highlights for 2025. 

Discussion With OPTrust CIO James Davis  

Earlier today, I had a discussion with OPTrust CIO James Davis, going over their 2025 results.

I want to thank him for taking the time to talk to me and also thank Jason White for sending me material and setting up this virtual meeting.

James began by giving me an in-depth overview covering everything in detail:

Well, the first thing I want to point out is that this is the 30th anniversary at OPTrust. It's also the 10th anniversary of our member-driven investment strategy and my 10th anniversary here at OPTrust. 

It's kind of a very opportune time to reflect on our investment performance at OPTrust in general. And I thought what I would do is give you a little bit of colour, since it is the 10th anniversary of our member-driven investment strategy, on how well that's done. That was introduced in 2015 and really what it was designed to do was to focus our plan on what the real objective is, which is sustainability, being able to pay pensions today and preserve pensions for tomorrow, which, you know, is our mission. 

And that's the metric that matters. The North Star for us is our funded status. So our investment strategy is very liability aware, and our North Star is the funded status. We are a pension plan, so we invest for the very long term. Our liabilities are long-term, and so we make investment decisions with that in mind, again, with the primary objective of improving plan sustainability. 

One thing I did want to point out is key to MDI is avoiding unnecessary risks. So recognizing we are mature we don't want to take risks unnecessarily. In fact, we only want to pursue risks purposefully and efficiently, striving for resilience. 

We also take a total portfolio approach, and I know that's becoming very, very popular now; people are talking about it a lot. We were an early adopter, and why I think that's so important is it breaks down silos within the overall organization. That's not just within the Investment division, but across the entire organization. It does recognize that risk is a scarce resource and it has to be shared, and as I mentioned, has to be taken purposefully and efficiently. It supports agility, which is really important, especially in the private markets, and it ensures alignment, and our alignment is within the overall organization, towards overall improvement of plan sustainability. 

So with that in mind, and then, you know, looking over the past 10 years, I think our MBI strategy has performed very well. We have a 6.7% rate of return over that 10-year period, which is above the return that we would need to preserve pensions today and or pay patients today and preserve pensions for tomorrow. And it's also ensured that we have remained fully funded. 

In fact, we're fully funded for the 17th consecutive year, as you would know from our funded status report. But perhaps what's not as well understood is we're the best funded we've ever been in history, in the history of the plan, going all the way back 30 years. And we've been able to reduce our discount rate to 2.8%, the lowest it's been in that 30-year period. And that's a real rate of return, so we've been able to build margins, and that adds conservatism to our overall plan. 

Now, one thing that's key to our MDI strategy is that we purposefully overweight illiquid assets. We have an abundance of liquidity, and we believe by investing in the liquid asset space, we have the best opportunities for value creation, and we get to harvest illiquidity premium over time. 

Now, all that being said, that's not always going to work in any particular year and 2025 is a challenging year for us, primarily because of our illiquid asset exposure. 

If you look at private markets, and in particular, I'm going to call on private equity, the reason we like illiquid markets is our private equity portfolio. Looking back to 2014, which is the numbers I have at hand, we've outperformed public equity by 6.2% per year, and over the last 10 years, it's been by more than 7% a year. That's one of the reasons why we're really in that space. It hasn't been the strongest performer within our illiquid portfolio last year in 2025 returning 4.6% It's also worthwhile noting that that is the lowest private equity return we've had in 12 years, and it's also a reflection of the current market environment where the liquidity is actually being penalized, and where there has not been a lot of deal flow and and what you're seeing is what I believe is a correction in the private markets in time, instead of in price. 

And that's a term we use in public markets all the time but I think it's actually appropriate in private markets as well. And if you do look over the last 12 years, in 9 of the past 12 years, our private equity asset class has achieved double-digit returns, with the highest return being in 2021 with a 52.2% rate of return. So that's one of the reasons why I like private equity and private market assets. But as I mentioned, they've been challenged. 

Let me talk very briefly about infrastructure, which has also been challenged, a 1.9% rate of return, which is low, lower than what we would expect in that particular asset class. But I got to put it in the context of the kind of returns we've had historically. And again, what's been going on in overall markets in 2021 and 2022 our infrastructure returns were 33% and 21.1% respectively. But again, deal activities literally ground to a halt, and we have a large exposure to renewables, and renewables have fallen out of favor. Part of that is an oversupply, but higher, longer-term interest rates also weigh on that particular sector of the infrastructure asset class as well. 

I do believe that renewables will recover and do very well. The energy challenges that we have and the need for more energy are not going away, and renewables are a solution, but it's just a period in time where it hasn't been working as well as it has historically. 

Probably the one you want me to touch on most is real estate, so maybe I'll weigh in a little bit of that. If you look at our overall investment returns and those of our peers, over the last several years, real estate has been a really challenging asset class, and we really reflected that in our 2025 results with a minus 8.5% rate of return. And so why is that happening? I think for us anyway, it's a function of the asset class in general, but it's also because we had some exposure to development assets which we had acquired before or around the time of COVID and things happened in the market that made development really, really challenging. 

One of the things that you had was supply-side, shocks and the cost of materials for construction went up. The cost of labor went up when COVID hit. You had problems. Can you imagine, you know, trying to pour concrete flooring and you have to socially distance by six feet with people that you're actually constructed in the building with so you have had challenges there. Then we know what happened in the office sector, and we know that the retail sector was challenged as well. 

Now we, earlier in this decade, benefited in our real estate portfolio by being overweight multi-residential and industrial that served us very, very well, and our long-term returns in real estate have been very strong. But what's happened is these development assets have been problematic for us, and we really reflected that in our real estate returns this year. 

So we're working through those challenges. And you know, we're optimistic that this is a great asset class for us to own. It continues to turn out great cash flow, is a good inflation hedge, relatively stable, but we are making some changes in how we think about investing in our liquid assets. So happy to share more about that in just a few minutes, if you want to dig in more on our approach to TPA.

But within, within the overall portfolio, what was the shining star? Our liquid portfolio, and our liquid portfolio did particularly well, primarily because of our exposure to gold and to equities. But it's more than that. 

Last year, we made a strategic change in the way we manage our liquid assets. You may recall that our liquid portfolio acts like a completion portfolio. And so we look at the overall risk profile we get from our illiquid assets, we look at what we need for our plan liabilities and what's happening in the macroeconomic environment, and adjust the liquid markets allocations accordingly. The team has a lot of flexibility there, they can do so within the illiquid asset space, they can go to where they think the best opportunities lie at any particular point line. We did not have a lot of credit exposure. We did, instead, choose to be in equities and in commodities, mostly gold, that, as I mentioned, did serve us particularly well. 

One thing that doesn't actually get reflected when you look at the returns in our liquid portfolio, to the extent that it probably should, because returns don't tell the story, and that's our bond portfolio. We have a significant portion of the portfolio and longer maturity government bonds. That's by design. That's our liability hedge portfolio that reflects our plan maturity, and it goes directly to our metric that matters, our North Star, which is the funded status. 

To the extent that you know interest rates go up, you will have disappointing performance in your long bond portfolio, but you will also have reduced liabilities, and similarly, when the opposite happens. So, we do view that as a stabilizer in the overall portfolio, and are willing to tolerate some drag on returns as a result of holding those assets. So I'm going to pause there, because I'm sure you want to dig in a little bit more.

James covered it well and I began by asking him in public equities if they use the MSCI ACWI Index and he responded:

I don't want to say we're benchmark agnostic. We do pay attention to what the indices are doing, because in many cases, we are getting our public equity exposure through index positions, but we're quite dynamic in that space. And as I mentioned, the public markets team, which is our liquid asset class team, or what we call our total portfolio management team, they can move things around quite significantly, and they can do so with a great amount of agility. 

So, last year, we reduced our exposure early on in the first quarter of 2025, and we did use the opportunity to add to our equity exposure once we got a clearer sense of where the tariff situation was appearing to land. 

And so we did the same thing throughout the course of the years. We've had exposures as high as 7% in gold and then as low as 3% in gold. So the team is quite dynamic. There is no gold in our benchmark. We don't think about it that way at all. What we do think about is absolute returns and what we need to pay pensions. 

I told James there used to be a risk-mitigation portfolio at OPTrust that invested in gold, commodities, USD, etc. and asked if that's still in place. 

He replied:

We still think about it that way, but we report in a way that we thought was simpler. There was some confusion around thinking about risk within the risk mitigation portfolio, not recognizing that our overall funded status and the volatility that funded status depends on all of the assets that are in the portfolio. 

So given that our goal is stability and sustainability of the plan, we thought calling a one small segment of the portfolio, which is about 10% of the assets, and saying that represents the risk mitigation portfolio, was probably not telling the full story, but the concept is still there. 

Gold is still viewed as a risk mitigation asset. Our liability hedge portfolio was viewed as a risk-mitigating asset, but we didn't call it that specifically within our risk mitigation portfolio historically. So that's why we report on that slightly differently 

So, the completion portfolio is not the risk mitigation portfolio? He answered:

No, but what it is designed to do is it's designed to complete the overall risk profile of the portfolio. So think of it this way, if there are no opportunities that are presenting themselves in the illiquid asset space, or if we can't get the risk factor exposure that we want in our illiquid asset space, we'll go to the liquid asset space and look for those opportunities. 

So if our private equity portfolio exposure is dropping, we would be adding public equities to the portfolio, assuming we still wanted that equity or that growth risk factor in the overall portfolio. You got you 

 I asked James if it's still 50/50 public /private now and he replied:

It's very close to that, as I say, that the public market equities have moved around, given the volatility over 2025, but if you look at it in general, we're probably somewhere around 15 to 18% on average, sometimes a little bit lower than 15 in public equities, and our private equities are around 17- 18% as well.

On Credit, James shared some very interesting insights: 

We're not big in private credit. I have some concerns with private credit. I think it's my view personally. I realize it's it's been a desirable asset class. You know, in many ways, it's disintermediated in the banks. Its growth has been driven by changes in regulatory policy, but it seems to be overhyped. I mean, I go to conferences, and that's all everybody's talking about, so it's an area that I've avoided.  

The other thing to keep in mind is the way we approach our private market assets; the teams can invest across the capital stack. So if there is a better opportunity in the credit space than there is in the equity space, they can take advantage of that. But we do not have an allocation. I don't have a core allocation to our sort of long-term acceptable risk portfolio, and it's not something that we would target when we sit look at the overall environment, say, 'Yeah, we want to, you know, we want to move 5% from here to there'. It's very opportunistic.

He added:

Where we do have credit exposure, which is minimal, in the public space, we would tend to do it either through CDX or through external managers, but in the private market space, to be very unique, would be specific to a particular deal. 

We then shifted to sustainable investing where James had this to share:

There's been a lot going on, as you are probably aware in the last several years on the responsible investing side of things, and so we've approached this in a couple of ways. First, we wanted to get metrics in place, which we did earlier, a few years ago, and then we had set what we felt was a pretty ambitious objective to reduce our overall carbon footprint. Which we did, we had reduced it between 2023 and 2024 I think, by 23% and we've continued our progress in responsible investing, but more with a focus on gathering data from our portfolio companies and from our partners.

For us to advance further and to have more influence and impact within our overall portfolio, we have to work with our partners, and we have to have data. So we need much more evidence-based and data-driven in our overall climate change strategy. So that's been the focus. 

We've also launched a taxonomy, a climate change taxonomy, which, to me, I think is really special. It's not focused on numbers. And quite frankly, I think, you know, focusing too much on numbers in the climate space can be misleading, but what it does tell you is what exposures we have in the plan, what assets in the plan are most exposed, and what assets are doing something about it. 

And so it's qualitative, but it does help us to identify at a higher level where the largest risks are within the plan and what we might where we might want to engage more so we continue to try to improve. It's our mantra of excellence and continuous improvement. We try to do that across the portfolio, but climate change.

I told him the federal government is trying to open up more opportunities in infrastructure investing and asked if that is something that interests OPTrust. 

He replied: 

For sure? We do have a significant exposure to Canada already, more than a third of the fund of I think it's about 36% or something, of the fund is in Canada right now. And there's nothing that would make me happier than to invest more and more in Canada if we could find the opportunities. And so the fact that the government is working with the pension plans and the private sector to try to make the environment more friendly for long-term capital investment. This is a wonderful thing.  

And if you think about Ontario as a whole, I mean, our members are in Ontario, the benefits that they are getting, they're spending that money in Ontario. So this is the economic benefit. Regardless of where those returns come from, they're going to go into our members' hands, and they're going to get multiplied throughout the overall economy. 

Wouldn't it even be better, the extent that we could get even more assets here? But it has to make sense. It has to make sense for us. And so to the extent that we can support government and policy makers to make a better environment for investing in Canada. You know, we're all over that.  

On membership, James shared this:

It's growing, I mean, it's partly in the public service. You're not expecting the same degree of growth, especially, you know, in this kind of an environment, but we are seeing both membership is improving, and that's a positive for us, but we are mindful. We are a mature plan, and we do have more retirees and deferred retirees than we do active members, and that's not going to change for some time. 

Lastly, we spoke about the challenges in private equity where I noted there's enormous competition there and across the private markets so maybe there is a structural change going on, and it will be increasingly harder to harvest returns of the past there.

James replied:

To start with, let me say that I remain very confident in the ability of that asset class to perform well. I would call out that there remains a lot of dry powder, a lot of investors are still looking to move into that space. 

As I mentioned, I think the market is correcting more in time than it is in price. I think some further correction in price would probably be welcome, because I think it would help unfreeze the market and improve/ move deal activity. So that'd be number one. 

Number two, we know that there is a move afoot to private markets, to other investors, whether it's over 401K or other retail-type investors in the United States, that will provide another source of demand. I'm not sure how it will impact overall returns and whether certain segments of the market will do worse or better, but it is an additional source of returns. 

The third thing, which I think is important, though, and I don't hear a whole lot about it, is to what degree will tokenization and the blockchain potentially impact the private markets. I think there is something there. I think we will begin to see assets slowly going on the blockchain, and there will be more price discovery, more price transparency. What I don't know, though, is, does that destroy the information asymmetry that you have now in that space. 

And I mean, that's where the value creation, that's a huge part of the value creation, is that you know your first call, and you've got access to deals, or you just happen to be you have great relationships in that space where you see things that others would not, and you're able to capitalize them on them. But if the market becomes more symmetric and more transparent, then that opportunity is going to go away.

Great food for thought, I always enjoy speaking with James, he's a really sharp and experienced CIO who has dabbled in meteorology in the past.

Alright, let me thank James and Jason once again. It was a really long week for me with back-to-back interviews and coverage and I need to rest.

Below, a member profile from OPTrust. Also, Audrey Forbes, Member Experience and Pension Operations, OPTrust who retired in June 2023, discusses the importance of taking care of members:

“I’m passionate about pensions because the vast majority of the people the industry serves could otherwise fall through the cracks without a pension. Many of these individuals could end up in poverty at retirement.

That’s why I love the public sector pension model—it provides financial security for many people who wouldn’t typically achieve it. In many ways, it’s an equalizer in the workplace, irrespective of colour, ethnicity or other demographic factors.”

Remember, it's all about members, that's why pensions exist to take care of their members.