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Hampshire County Retirement to end hedge fund allocation

Hampshire County Retirement System, Northampton, Mass., has decided to stop allocating to hedge funds, said Patrick E. Brock, retirement board chairman, in an email.

The $278 million pension fund's board voted to reduce its target allocation to hedge funds to zero from 5%. The 5% allocation will be moved to the pension fund's equity investments.

The retirement system gets its hedge fund exposure by investing via the $63.2 billion Massachusetts Pension Reserve Investment Trust Fund, Boston, through its segmentation fund. The retirement system had about $7.8 million in hedge funds as of Jan. 31.

Mr. Brock said the board cited poor performance, lack of transparency and a general lack of understanding about the hedge fund as the main reasons for choosing to pull out of hedge funds. The decision was also made due in part to concern by the pension plan's regulator, the Massachusetts Public Employee Retirement Administration Commission, over high fees.