Pension Fund News/Headlines/performance/updates

Via HFN daily

MassPRIM Replaces Hedge Fund Defector
The Massachusetts state Pension Reserves Investment Management Board (MassPRIM) named a new executive director.

Michael Trotsky, formerly with the Massachusetts Health Care Security Trust, will replace Michael Travaglini, who left MassPRIM last month to join asset manager Grosvenor Capital Management in Chicago.

MassPRIM currently manages the retirement systems covering 250,000 current and former public sector employees from the Bay State. The system has $44 billion in assets under management, its Web site said.

The system has allocated $3.2 billion to hedge funds, according to the pension's latest statistics on its Web site.

Mass PRIM has allocated capital commitments to five hedge funds-of-funds run by Arden Asset Management, Grosvenor, K2 Advisors, PAAMCO and The Rock Creek Group.

For the year ending March 31, MassPRIM's hedge fund investments have returned 13.24%.

The HFN Funds-of-Funds Aggregate Index was down 0.7% year-to-date through July.

MassPRIM's private equity portfolio, comprised of dozens of venture capital and equity partnerships, was valued at $4.3 billion, as of March 31.

For the year ending March 31, MassPRIM's private equity portfolio returned 13.58%. The pension benchmarks its private equity performance to the Russell 3000, which had a one year return of more than 52% on the same date, according to the pension's Web site.

The pension said it expects its private equity portfolio to outperform the Russell 3000 by 3% over the long term.

Princeton Endowment Comes Back Strong
Princeton University's endowment had a good fiscal year 2010, earning 14.7% as of June 30, a sharp turnaround from fiscal year 2009 when it was down 23.5%.

The university's returns bested its Ivy League neighbor to the north, Harvard University, which returned 11% as of June 30.

Assets under management at the Princeton endowment were $14.4 billion, a 14% jump over the previous fiscal year when AUM was $12.6 billion, the university said in a statement.

The university had responded to the downturn in its endowment funds by cutting spending by $170 million over two years.



VIA HFN DAILY

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New Jersey's $70 Billion Pension Fund Is Negotiating Fee Cut From Managers
By Dunstan McNichol - Oct 21, 2010
New Jersey’s $70.2 billion pension fund for teachers and government workers is negotiating reductions in fees and expenses for private managers after paying $125 million last year, said Timothy Walsh, director of the Division of Investment.

The state is seeking new terms at the same time it’s proposing to increase the share of its holdings that can be placed in privately managed assets, such as hedge funds, to 38 percent from 28 percent, according to testimony at a State Investment Council meeting today.

The 13th largest U.S. pension fund, according to its website, hopes to work out a lower fee structure by year end, Walsh said in an interview after the meeting.

“We went through a period when general partners were in great demand,” said Robert Grady, chairman of the council, which sets policy for the fund. “The pendulum has swung a bit back to the limited partners. I think it’s perfectly appropriate and responsible for New Jersey and other states to negotiate the best terms they can.”

The California Public Employees’ Retirement System, the biggest public pension in the U.S., negotiated a $50 million cut in fees from CIM Group LP, a Los Angeles real-estate investment manager, according to an announcement yesterday.

Management Fees

New Jersey pays most of its private partners 2 percent management fees and a 20 percent share of gains, state records show.

The fund had about 14 percent of its assets in privately managed alternative investments, according to a report presented to the State Investment Council today. The council voted to raise the maximum allowable allocation in alternatives to 38 percent from 28 percent.

The pension fund gained 8.3 percent for the fiscal first quarter ended Sept. 30, according to the director’s report. The fund’s $70.2 billion value is the highest in two years, according to state records and the report.

For September, the fund realized investment gains of 4.2 percent. U.S. equities returned 9.4 percent, international stocks gained 9.3 percent and domestic fixed income was down 0.14 percent, according to the report.

“The world markets could be characterized for September with two words, ‘nervous ebullience,’” the report said. “On the two-year anniversary of the start of the world equity and credit market crash, the S&P 500 had its best September since 1939.”

The state Treasury’s Investment Division manages money for seven pension plans, which provide benefits to 728,000 working and retired teachers, police officers and government employees.

Through June 30, 2009, actuaries calculated the pension system was underfunded by $46 billion. It had 66 percent of the assets needed to fund promised benefits, according to data compiled by Bloomberg.

To contact the reporter on this story: Dunstan McNichol in Trenton, New Jersey, at dmcnichol@bloomberg.net.

To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net.

®2010 BLOOMBERG L.P. ALL RIGHTS RESERVED.

http://www.ctv.ca/generic/generated/static/business/article1766709.html

Pension funds rally in third quarter

JANET McFARLAND

Canadian pension funds rallied in the third quarter this year, making up for losses in the second quarter and pulling year-to-date returns to “a respectable” 5.7 per cent, a new survey has found.

An RBC Dexia Investor Services survey of Canadian pension funds shows a global market rally in September lifted pension fund returns by 7.3 per cent in the third quarter. Canadian stocks were the best-performing asset class, increasing 10.2 per cent in the quarter and 6.7 per cent in the year to date.

“It’s been a bumpy ride, but this quarter’s gains make up for the last quarter’s pull back and bring year-to-date totals to a respectable 5.7 per cent,” said Don McDougall, director of advisory services at RBC Dexia.

The gains so far in 2010 come on the heels of a strong increase in pension returns in 2009, when plans posted average returns of 16.2 per cent and made back most of their sharp declines from 2008. Pension funds lost 15.9 per cent in 2008.

RBC Dexia calls its pension survey the most comprehensive in Canada, measuring returns for pension funds with a total of $340-billion of assets under management.

The latest survey found all major asset investment categories posted gains in the third quarter. Foreign stocks rebounded 9.9 per cent in the quarter and Canadian bonds were up 3.4 per cent.

Currency fluctuations did not have a major impact on returns. While currencies have been volatile, RBC Dexia said they have “tended to cancel themselves out” over the third quarter and over the year-to-date, with U.S. dollar weakness offset by the strength of most other major currencies against the loonie.

Recently New York's Pension Fund returned about 8%

and now…


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CalPERS Returns 13%, Alt Investments Mixed
The California Public Employees' Retirement System (CalPERS) released its returns for fiscal year 2009-2010 and things are looking up for the United States' largest public pension plan.

For the year ended on June 30, CalPERS had a net return of 13.3%, valuing the plan at $200.5 billion in assets. That number has climbed in the last few months, with the plan's value at $221.5 billion as of Nov. 8, according to its Web site.

CalPERS continues to rebound from the recession, gaining $40 billion since March 2009, according to a statement. The plan said it had saved nearly $300 million in fee reductions external managers and the elimination of poor performing funds.

The pension's 13.3% return bested its preliminary returns published in July by nearly two percentage points.

For fiscal 2009-2010, CalPERS' performed strongly in nearly all asset classes except real estate and hedge funds.

Private equity performed well for the year, finishing up 23.88%; hedge funds, not so well, down 0.8%.

CalPERS' hedge fund efforts are part of the pension's Risk Managed Absolute Return Strategies program, which had $5.5 billion in assets under management as of June 30.

As of Nov. 8, the pension's private equity investments totaled $30.5 billion, according to CalPERS' latest figures on its Web site.

Other sectors included global fixed income up 20.35%, public stocks up 14.42%, commodities, infrastructure, forestland and bonds up a combined 8.70%. Real estate was down 10.76%.



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Continue trends and evidence of institutionalization of the industry....


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Texas Pension Plan Adds $1B to Hedge Fund Investment
One of the largest pensions in Texas has allocated an additional $1 billion into its hedge fund portfolio.

The $18.2 billion Texas County & District Retirement System (TCDRS) invested the money in March, according to an HFMWeek article.

TCDRS is allocating the additional billion to 20 funds in total.

The pension has allocated $3.4 billion to hedge funds as of March 31, which is 18.9% of hedge fund allocation, HFMWeek reported.





Hedge Fund Investment Hitting $195B Next 12 Months
Investors in the next 12 months plan to commit $195 billion to up to 2,000 hedge funds, according to a new report.

The report by London-based research firm Prequin found that 87% of those planning to invest include long/short equity as a strategic preference, and 58% are taking an opportunistic approach.

Also, emerging managers are becoming more popular, with 28% of investors surveyed stating they are more open to marketing from emerging managers than they were the previous 12 months.

Smaller, less experienced hedge funds are also gaining more attention from investors; with 33% of those surveyed saying that will consider firms with less than $100 million in assets under management, and 60% planning to focus on managers with a track record of at least three years.

Other findings included 36% of public pension funds are looking to make extra allocations to hedge funds in the next 12 months, with 47% of the investors surveyed are seeking opportunities to invest in funds of hedge funds. And 50% of those with investment plans are looking to commit to North America-based managers.


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