San Bernardino Beefs Up Credit Portfolio

Sep 11 2008 | 1:00pm ET

At least one pension fund investor just can’t get enough of credit-focused hedge funds. The $6 billion San Bernardino County (Calif.) Employees Retirement Association recently committed $150 million to credit-focused hedge funds.

San Bernardino this week committed $30 million apiece to Declaration Management & Research’s DMR Mortgage Opportunity Strategy, Stone Tower Capital’s Structured Credit Recovery Fund and York Capital Management on their York Credit Opportunities Fund.

Last month, the plan’s consultants, NEPC, and staff recommended an allocation of $30 million to the MKP Credit Fund and $30 million to Mariner Tricadia Credit Strategies Fund.

On the private equity front, the plan’s chief investment officer, Timothy Barrett, said that he has been approached by well-established firms to invest directly in companies through co-investments. He said that direct company investments, while potentially an avenue for increased returns, requires a disproportionate amount of resources for the potential value-added.

The plan currently has a 15% exposure to private equity and 7% to hedge funds.


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