It’s been a roller coaster ride for Hawaii’s largest public pension fund over the last half-year.

Up a whopping 6.3%, or nearly $1 billion in assets, in the most recent quarter. Down a staggering 5.9%, or more than $1 billion in assets, in the preceding three months.

Long-term investing, anyone?

“We ignore little and react to less, especially during times of significant market volatility,” Employees’ Retirement System Administrator Thom Williams said. “We are keen observers of the markets but focus on the long term. Over that time frame, asset allocation impacts returns to a much greater degree and poses less risks than do short-term tactical bets.”

The ERS, which provides retirement, disability and survivor benefits to 124,089 active, inactive (vested) and retired state, city and county employees, likely won’t reach its 7% investment target by the end of the fiscal year on June 30. That target, referred to as an assumed rate of return, helps cover financial obligations to current and former employees.

The portfolio was up only 2.5% through the first nine months of its fiscal year after recovering last quarter from the U.S.-Chinese trade war that sent U.S. and global indexes reeling in December.

Traditional growth stocks in the ERS portfolio jumped 12.2% to power the fund last quarter, according to a report presented recently to ERS trustees by Meketa Investment Group, which in April acquired ERS’ former adviser, Pension Consulting Alliance LLC.

“We are not focused on picking individual stocks to generate top-line portfolio returns, as we are a diversified institutional investor and recognize that putting all of our eggs in one basket would be dangerous,” ERS Chief Investment Officer Elizabeth Burton said. “In general, first-quarter traditional U.S. equity performance was driven by tech, as well as economically sensitive sectors such as energy and industrials.”

ERS assets, which besides investments are affected by benefit distributions, contributions and expenses, ended the quarter at $16.7 billion after starting the three-month period on Jan. 1 with a market value of $15.8 billion. The 6.3% gain and 5.9% loss in the two most recent quarters reflect investment returns only.

The pension’s portfolio has been buffeted in recent months by the trade war between the U.S. and China, but Burton said that ERS trustees are staying the course.

“We do not ignore market volatility, but we are aware that it is difficult to time markets, so we are more focused on the potential long-term ramifications to the economies of both countries than to daily market turbulence as we are better positioned to navigate the long term than the short term,” he said. “As long-term investors we invest in academically and economically defensible investment strategies that we believe will add value over the long term. Otherwise we will suffer from the implicit and explicit costs of jumping in and out of markets and churning fees and diminishing returns.”

The ERS fund had a shortfall of $13.41 billion at the end of its last fiscal year and was only 55.2% funded, meaning it had just over half of what it needed to meet future pension obligations. An actuary report by Gabriel Roeder Smith calculated that it will take 25 years, or until June 30, 2043, before the pension is 100% funded.

But Williams has said that beneficiaries should not worry due to pension reforms in place that eventually will eliminate the unfunded liability. Those pension reforms include increased contributions from employers, namely taxpayers, that are based on a percentage of an employee’s pay. The higher payments will cut into the shortfall in future years. Williams said the shortfall is expected to keep increasing for the near term until the higher contributions take hold.

Lawmakers passed legislation in 2017 to close funding shortfalls that were created partly due to existing unfunded liabilities, retirees living longer and lower projected investment returns.