CalPERS To Boost Private Equity Target

June 9, 2009

Aiming to buy low, the nation’s largest public pension fund is poised to increase its private equity investments by about 40%.

The California Public Employees’ Retirement System is set to approve an increased target for corporate buyout and venture capital investments to 14%, up from 10%. Under the plan, private equity and venture capital investments could reach 19% of the fund’s total assets; currently, CalPERS invests 13% in the asset classes.

“This is a great time to make some good deals,” spokesman Clark McKinley told Reuters. “when markets are down, it’s a good time to buy.”

The boost to p.e. and VC comes at the expense of CalPERS’ equity portfolio, which includes hedge funds. The pension giant has no plans to change its hedge fund allocations, McKinley said, but losses by the hedge funds and other equity managers employed by CalPERS have effectively cut its exposure to them.

From FINalternatives June 9, 2009