Florida Pours $700M Into Hedge Funds

Oct 4 2010 | 2:30am ET

The Florida State Board of Administration's taste for debt funds is proving a boon for hedge fund managers—and a boon that could be getting bigger.

The $117.1 billion pension plan has allocated money to seven hedge funds since June, when it boosted its strategic investment allocation—which includes distressed-debt and hedge funds—to 6% from 3.9%. The SBA plans to increase that further, to 11%, and is now searching for a risk modeler to provide risk measurement and monitoring models for its hedge fund portfolio, Pensions & Investments reports.

The big winner was Knight Vinke Asset Management, which received $250 million. The SBA also made four $100 million allocations, including to hedge fund P2 Capital Partners. The other nine-figure mandates went to three firms managing debt funds: Audax Group, Bayview Financial and Blackstone Group's GSO Capital.

The public pension also allocated $50 million to Oaktree Capital Management, and has approved an investment with CarVal Investors, which is pending. Consultant Cambridge Associates is still running several searches for direct hedge fund investments.

Responses to the invitation to negotiate for the risk modeling contract are due by Nov. 19.


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