The Hawai'i Employees' Retirement System, the state's largest pension fund by assets, earned less than it hoped in the most recent quarter, as several of its money managers stumbled on energy and utility investments.

The $9.62 billion pension fund yesterday reported earning a 1.8 percent return on its mix of stocks, bonds and real-estate investments during the three months ended Dec. 31. That was below the 2.2 percent benchmark it wanted to produce or exceed.

Real estate also lagged a target return during October, November and December.

From July to December, which is the first half of ERS's fiscal year, the fund earned 5.9 percent on investments, helped by a close to 4.1 percent increase in the first three months of that period.

"It's a good start to the year," said T. Kimo Blaisdell, ERS chief investment officer. He said the present quarter is going well, with U.S. stock markets rising and the potential for good real-estate returns later this year.

ERS adviser Callan Associates said the fund remains well positioned to meet its goal of an 8 percent return for the full fiscal year. Its assets, minus benefits paid to retirees, grew by $129.4 million in the October-December quarter.

The performance was hurt by large-capitalization stocks not faring as well as they had previously, Callan's Matthew Beck said. That included energy stocks and utility stocks, something that caught some of the fund's investment managers off guard, Beck said.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.