The $750 million Arlington County Retirement System's trustees decided at a board meeting yesterday to boost exposure to foreign stocks to one-fifth of total assets, from 13% currently, including a separate allocation of 6% to emerging markets, said Bruce O. Kallos, administrator.
As recommended by its consultant, SEI, the fund will reduce its global fixed-income portfolio to 27% of assets from 29% and slice its large-cap domestic portfolio to 36% - including a new 10% allocation to indexed stocks - from 39%. In addition, the fund will pare its domestic small-cap stock holdings to 12% from 15% and will maintain its exposure to real estate up to 5% of assets.
The Arlington, Va.-based fund hopes to complete its search for a manager to run the emerging market allocation within the next month, and then search for a core domestic index manager, Mr. Kallos said.
The fund also is setting up a risk management system, Mr. Kallos said. The objective will be to outperform, over a rolling 12-month period, a benchmark made up of various indexes of different asset categories in the same proportion as its asset allocation.
