CalPERS approves new asset allocation

US – CalPERS has increased its allocation to private equity and adopted a new cash bucket at an investment committee meeting yesterday.

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As previously reported, the board at the California Public Employees’ Retirement System increased its allocation to private equity to 14% from 10% and raised its cash target to 2% from zero. (Global Pensions, June 10, 2009)

The changes will mainly be funded from a reduction in global equity, which will drop to 49% from 56%.

The new allocation is meant to be an interim change until the board performs a long-term review of its investments next year.

Chair of the CalPERS investment committee George Diehr said: “This is not intended to be a long-range strategy but reflects our preference for higher liquidity and moderate risk, as well as the flexibility to respond to challenges and opportunities in the markets.

“Our investment officers will follow these guidelines as we position ourselves for short-term investment opportunities over the next year or so.”