PORTLAND, Ore. - Equity allocations by large public pension funds rose in 1995, according to a study of 104 public funds conducted by R.V. Kuhns & Associates Inc., Portland.
The weighted average allocation to U.S. stocks rose to 45% as of Dec. 31, from 41.2% a year earlier, results of the study show.
The largest allocation was more than 60% while the smallest allocation was just more than 20% (One fund reporting had no equity allocation, because it is prohibited by state law).
Weighted average allocations to international or global stock portfolios climbed to 10.4%, from the 1994 year-end allocation of 9.7%. Eighty-eight funds had allocations to international equities.
The allocations to equities increased largely at the expense of U.S. fixed-income allocations, which fell to a weighted average of 32.7%, from 37.1% at year-end 1994.
Global and international fixed-income allocations were flat, standing at a weighted average of 2.6% as of year-end 1995, compared with 2.7% a year earlier. Forty-six funds had an allocation to global or international fixed income.
Equity real estate allocations also fell, with funds reporting a weighted average allocation of 3.6%, down from 3.8%.
Allocations to alternative equities rose slightly, to a weighted average of 2.1% from 1.9%.
Eighty-two of the surveyed funds provided fee information. Of those, the average total investment management fees paid were 21 basis points. Funds with more than $20 billion under management paid an average of 6 basis points, and funds in the $10 billion to $20 billion fund size range paid 9 basis points.
Fees jump markedly higher from there, with funds in the $5 billion to $10 billion category paying an average of 21 basis points; funds in the $1 billion to $5 billion, 22 basis points; funds with $500 million to $1 billion, 23 basis points; and funds in the $100 million to $500 million range, 30 basis points.
Funds in the survey managed a total of $802 billion.