Oklahoma Pension Begins Direct Hedge Fund Program

Dec 5 2012 | 10:46am ET

The Oklahoma Police Pension & Retirement System is the latest institutional investor to dip its toes into direct hedge fund investing.

The $1.85 billion plan is moving $31 million from two funds of hedge funds to four hedge funds, Pensions & Investments reports. The beneficiaries of the plan, which will eventually see the pension invest in between eight and 12 hedge funds directly, are AKO Capital, Cevian Capital, Tremblant Capital Group and Trian Partners.

Oklahoma Police in May decided to terminate one of its funds of funds, Attalus Capital, which managed about $80 million; $20 million has been redeemed with the remainder to come over the next six to 12 months, according to P&I. It also plans to pull about $25 million from Grosvenor Capital Management's $175 million, although Grosvenor has been charged with doing back-office and due-diligence functions for the pension's direct hedge fund portfolio. Asset Consulting Group will assist.

All four of the selected hedge funds, Oklahoma Police's first direct hedge fund investments, were in both Attalus' and Grosvenor's funds of funds.

Oklahoma Police said the change will save it more than $1 million per year in fees.

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