California continues to focus on a golden destination of pure alpha

Mon Sep 5, 2011

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CalPERS takes hedge funds out of the domestic equity bucket as it aims to invest $9.5 billion


Craig Dandurand
The $238 billion California Public Employees' Retirement System (CalPERS) has nearly finished realigning its relationships with hedge fund managers. Now after 10 years it is re-stating its absolute return aims and tactically streamlining its hedge fund investments to be more than just an equity hedge.

The most recent allocation to its Risk Managed Absolute Return Strategies Program (RMARS) is a $100 million commitment to the Standard Pacific Eureka Fund, a long/short equity fund that has a global focus on mid-cap stocks. The fund's investment approach is fundamentally driven by developing information channels across industries, up and down the supply chain and around the world. This, in addition to hiring a market-neutral hedge fund managed by OMG Capital earlier this year, also for a $100 million allocation, are CalPERS' first new allocations for a number of months.

The allocation framework for the absolute return strategies programme has yet...

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