CalPERS Moves To Increase Hedge Fund Investments

June 13, 2003 ( - The nation's largest public pension fund, the California Public Employees' Retirement System (CalPERS), has announced plans to increase its hedge fund investments.

The $131-billion pension fund, which has lost 6.7% of its value in the past 12 months, currently has investments with 14 hedge fund managers.   However, in an effort to turn around recent asset losses, the pension fund plans to work with Blackstone Alternative Asset Management to hire as many as six more managers during the next six months, CalPERS Chief Investment Officer Mark Anson told Bloomberg News.  

Currently, CalPERS has approximately 1% of its assets in hedge funds, yet Anson did not elaborate as to how much that allocation would be increased.    “It’s prudent to go back to the board and ask for a bigger allocation,” Anson said in an interview at a conference in Geneva. “There are managers we’re looking at.”

The assets to be earmarked for possible hedge fund investments will most likely come from funds now invested globally in stocks in addition to assets from its fixed-income funds, Anson said.   Additionally, the pension fund is mulling buying stakes in the hedge funds in which it invests.