The appeal to investors: Rising institutional demand

Tue Oct 6, 2009



In the summer of 1991, the Virginia Retirement System (VRS) took what was regarded as a bold and unusual step for a US pension fund. It made a modest allocation of $100 million to a diversified selection of managed futures strategies, and it monitored its exposure with something approaching obsessive care.

That experiment came to a shuddering halt following a barrage of negative publicity and a political reshuffle in the state. "The Virginia investment in managed futures was big news at the time," recalls Marc Goodman at Kenmar. "Although the Eastman Kodak pension plan had previously invested in managed futures, this was the first time that a public retirement system had done so. Unfortunately, when the governor was voted out, the new administration appointed a new investment board and, rather than learn about futures, they decided the smartest thing to do would be to exit the entire programme."

Goodman adds...

ISSN: 2151-1845 / CDC10004H

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