Louisiana Sheriffs' Pension & Relief Fund, Baton Rouge, is conducting an invitation-only search for active high-yield and emerging markets debt managers to run a total of about $100 million, confirmed Osey “Skip” McGee Jr., executive director.
The $2.2 billion pension fund is considering allocating up to 5% to the two strategies in an effort to get some “incremental increases in performance without taking on a lot more in risk,” Mr. McGee said in a telephone interview.
Funding will likely come from fixed income, which now constitutes 30% of total assets. No managers will be terminated.
Investment consultant Russell Investments will present its shortlist to the pension fund's investment committee in March, when finalists will likely be chosen, Mr. McGee said. Finalist presentations and a selection would likely be made in April.
Mr. McGee also said Russell has recommended an invitation-only search later this year for the pension fund to take on a third hedge fund-of-funds manager to run about $25 million to $30 million. Funding would likely come from a combination of cash and fixed income.
The pension fund is also considering increasing its equity exposure by two to four percentage points, allocating additional money to existing managers. The pension fund is currently slightly overweight equities at 56.5%, compared to its target of 55%.