P.E. Boosts CalSTRS As Pension Boosts Hedge Funds

Jul 21 2010 | 10:40am ET

Following a dismal fiscal year 2009, the California State Teachers’ Retirement System turned to alternative investments, and the nation’s second-largest public pension fund was not disappointed.

The plan enjoyed a 12.3% return in the year ended June 30, buoyed by a 21.7% return in its private equity portfolio, which accounts for 14.5% of CalSTRS’ $129.8 billion in assets.

CalSTRS tumbled some 25% in its last fiscal year. It then decided to temporarily move 10% of its assets out of global equities, with 5% temporarily going to a new portfolio of fixed-income, private equity and real-estate, and the other 5% permanently going to a new hedge fund investment plan.

The pension has also created a new unit to investigate new investment strategies, including global macro hedge funds and commodities.

“We’ve taken steps to position the portfolio for long-term growth, but we’re not out of the woods yet,” Christopher Ailman, chief investment officer, said. “The American economy suffered a near-death experience in 2008, and it’s going to take some time to fully recuperate from that. This year’s performance is a solid start along that road to recovery.”


In Depth

Change In 'Accredited Investor' Definition Could Hurt Crowdfunding Space

Jul 25 2014 | 8:14am ET

The Securities and Exchange Commission is considering changes to its 30-year-old...

Lifestyle

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Guest Contributor

The Truth About Track Record Portability

Jul 24 2014 | 5:55am ET

The number of private funds converting to mutual funds has increased significantly...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note