Texas Teachers emulates FoHF mindset for direct success
Wed Apr 4, 2012
The $4.3 billion portfolio expands to include seeding and an equity stake in a high-profile hedge fund
By Ann C. Logue
Teacher Retirement System of Texas (TRS) is a big fund for a
big state. The plan has accumulated $110 billion over its 75
years of operation. Since its founding in 1937, Texas Teachers
now provides pension and health insurance benefits to 1,316,566
participants, 23.7% of whom are retired. Members work in all
jobs in school districts, charter schools, colleges, and
universities throughout the state.
In terms of contributions, actuarial status, and benefits,
Texas Teachers looks like almost every other government pension
plan. But look deeper, and it’s clear that it is
not. Texas Teachers has a unique structure designed to reduce
costs and give the managers control of and transparency in the
portfolio. Money managers are asked for transparency and to
consider co-investment options. As much as possible, the
investment approach for the pension is that of a fund of funds,
ISSN: 2151-1845 / CDC10004H
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