L.A. Pension Hikes Hedge Fund, Private Equity Targets

Aug 14 2012 | 12:22pm ET

The Los Angeles County Employees Retirement Association will increase its alternative investments allocation by more than half.

The $38.6 billion pension has boosted its private equity allocation to 11% from 7% and its hedge fund allocation by threefold, from 1% to 3%, Pensions & Investments reports. The new alternatives money comes from cuts to LACERA's global equity and fixed-income portfolios.

The new private equity target merely reflects the reality of LACERA's portfolio, which already has 10.3% of its assets invested in the space. But it could prove a billion-dollar boon for hedge funds: LACERA currently has only 0.7% of its money in the asset class.

In addition, LACERA awarded mandates to private equity fund Lightyear Capital and real-estate fund Europa Capital. The former got up to $105 million and the latter €50 million.

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