Mon, May 1, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Two U.S. retirement funds to allocate $330m to L/S equity hedge funds

Thursday, February 18, 2010
Opalesque Industry Update – Two American retirement systems have announced plans to allocate a total of $330m to long/short equity hedge funds, reported PIonline.com.

The San Bernardino Country (California) Employees’ Retirement Association is looking for a long/short equity hedge fund manager for its first-ever $150m allocation into hedge funds, the first report said.

Investment officer Don Pierce said that the $5bn retirement system has tasked its investment consultant NEPC to search for a manager. The new allocation is part of the system’s overall move to active equity management.

And the Milwaukee County Employees’ Retirement System appointed K2 Advisors and ABS Investment Management to manage its long/short equity funds of hedge funds, another report indicated. Retirement system manager Gerald Schroeder said each manager would be given $90m each or 10% of the system’s assets.

It is also the first foray of the $1.8bn fund into hedge fund investment.

Schroeder said the fund would come from rebalancing from overweight asset classes such as fixed income, which was at 44.1% of total assets as of Dec. 31, and domestic equity, 30.9% as of the same date.

The surge in hedge funds allocations by institutional investors was predicted by industry tracker Preqin in its December 2009 report, which said that hedge fund managers could rely on institutional investors when seeking new capital this year.

Preqin’s latest report in January, which surveyed 60 institutional investors, showed that the number of institutions investing in hedge funds through separate or managed accounts could more than double in 2010. At least 16% of those surveyed said they already invested in hedge fund separate accounts and an additional 23% are considering making their first separate account investment in 2010.

Only this week, it was reported that Persian Gulf Arab investment institutions were expected to shore up allocations to hedge funds in the coming months as InvestCorp Bank BSC of Bahrain, which manages $12bn, has signified intentions to raise its hedge fund portfolio.

Australia’s Future Fund also announced early this month that it allocated some $4.2bn to three hedge fund managers; Ochs Ziff, a US-based multi-strategy manager, BlackRock Alternative Advisors, which has various hedge fund strategies managed from several countries including the former Quellos Capital Management, and Brevan Howard, a UK-based alternatives manager.

Although institutional investors are now more willing to invest in hedge funds, they are also demanding more transparency and control over their portfolio. The $200bn California Public Employees’ Retirement System (Calpers), one of the largest and best-known institutional investors, wants more control over the hedge funds it uses. Calpers said it will no longer allow to pool money with other investors in the conventional fund scheme. It also wants these managers to trade directly for Calpers’ individual accounts, an arrangement that would allow the pension fund to see and control all the securities the manager picks on its behalf. – KM –

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: Ex-Man manager combines sustainable investing with AI/ML[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Dr. Richard Bateson, quant fund manager and physicist, has recently

  2. Other Voices: "Winner-take-all" dynamics and hedge fund investing[more]

    A growing stream of thinking in microeconomics is the concept of "winner-take-all" dynamics. The idea seems simple. A combination of networking economics and classic economies of scale creates situations where there are just a few dominant firms or economic agents who are able to capture significant

  3. Investing - How Chipotle's comeback attracted big data robots and value investors alike[more]

    From Forbes.com: When William Ackman's ailing hedge fund Pershing Square Capital Management bet $1 billion on shares in Chipotle Mexican Grill beginning in July 2016, the stakes couldn't have been higher. Pershing Square was reeling from what would eventually be a near $4 billion loss in drugmaker V

  4. Gondor Capital sees challenges ahead for financial markets as two hedge funds post strong gains in Q1[more]

    Komfie Manalo, Opalesque Asia: Vincent Au, portfolio manager of New York-based hedge fund firm Gondor Capital Management believes that the remaining of the year would be challenging for the financial markets even as his two hedge funds maintain

  5. Service Providers - Colemore launches fee tracking service for limited partners[more]

    Following Colmore's successful launch in January 2017, the firm has announced the launch of FAIR.. FAIR is designed to help private equity investors independently validate fees and incentives charged by underlying managers, saving time and providing an extra level of comfort. There is a glob