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By the Opalesque Team:

CalPERS’ CIO, Joe Dear, testified July 15 before the U.S. Senate Banking Subcommittee on Securities, Insurance and Investment. Mr. Dear’s testimony was presented at a hearing on options for regulating hedge funds and other private pools of capital.

CalPERS is the largest public pension system in the United States with a total fund market value of approximately $180 billion and annual payout obligations of over $10 billion to California pensioners.

In his written statement regarding ‘Regulating Hedge Funds and Other Private Investment Pools’, Mr. Dear said that the CalPERS Board follows a strategic asset allocation policy that targets the percentage of funds to be invested across a broad array of asset classes and strategies. CalPERS invests in private equity and hedge fund investment structures with the objective of diversifying its investment portfolio, managing risk, and adding value to the total fund.

Important benefits to CalPERS provided by investing in private equity and hedge funds include effective risk management and investment value creation through allowance for the diversification of its portfolio across a broad array of asset classes.

“Today, we have approximately $20 billion invested in private equity strategies and $6 billion invested in hedge fund investment strategies that combined represent just over 14% of CalPERS’ total asset allocation,” he said. “The 5 year hedge fund program annualized return is +3.89% versus......................

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