The median separate account equity manager in Pensions & Investments' Performance Evaluation Report lagged the S&P 500 and the Russell 3000 indexes in the fourth quarter.
The median equity manager returned 7.1%, while the S&P returned 8.3% and the Russell 3000, 7.7%.
For calendar 1996, the median manager reported a return of 22.1%, compared with the S&P's 23% and the Russell 3000's 21.8%.
The median separate account fixed-income manager in PIPER returned 2.8% for the quarter and 4% for the year. The Salomon Brothers Broad Bond index returned 3% and 3.6%, and the Lehman Brothers Government Corporate Index returned 3% and 2.9%, respectively.
The median PIPER non-U.S. equity manager returned 3.9% in the fourth quarter and 12.5% for the year, compared with respective MSCI EAFE returns of 1.7% and 6.4%.
The Canadian Forces Non-Public Fund Employees Pension Fund could hire its first specialty managers and increase its allocation to equities, said Gerry Haman, CFO, Canadian Forces Personnel Support Agency, Ottawa.
He suggested the fund, with C$50 million (U.S. $37 million) in assets, could hire up to three specialty managers for Canadian and international investments.
The fund also is considering increasing its allocation to Canadian equities, now 37% of total assets. The allocation could be boosted to 50%; assets would come from Canadian fixed income, now 38% of the fund.
A decision on both issues could be made in April.
Altamira Management is the fund's sole manager; Mercer is assisting in the studies.
The San Francisco City & County Employees' Retirement System selected three semi-finalists in its search for a real estate investment consultant. In the running are Eileen Byrne Associates, E&Y Kenneth Leventhal/PCA Consulting and The Townsend Group, the $7.5 billion fund's current real estate consultant. Final selection is expected in late March. The fund has about 8% of its assets in real estate.
Staff members for the $67.8 billion California State Teachers Retirement System, Sacramento, are seeking board approval for an RFP to hire one or more international securities lending firms for securities within the MSCI EAFE index. The fund has about $8 billion in its indexed MSCI indexed portfolio managed by Barclays Global. Securities in Japan, Germany, the United Kingdom, France, Switzerland and Italy would be included. The lending contracts would be for five years. The RFP is expected to be released in March. Firms to be considered must have an average daily balance of securities on loan or borrowed of more than $1 billion. The fund's master trustee, State Street Bank has been doing some international equity securities lending for the fund.
The Korea Small Companies Trust was the top performing emerging markets fund in 1996 with a total return of 168.95%, according to Micropal Emerging Market Fund Monitor.
This came despite the generally poor performance of the Korean stock market overall; Micropal attributed the fund's stellar performance to the fund's holding of Medison, a stock that soared after its early 1996 listing on the Korean Stock Exchange. The $2 million Korea Small Companies Trust is managed by Korea Investment Trust Co., Seoul.
Russian and Eastern European funds rounded out the top 10 performing funds, according to Micropal. Three Russian funds of Hong Kong-based Regent Pacific Group finished among the top six, including White Tiger Investment Co., which ranked second for the year with a whopping 150.46% gain, fifth-place Blue Tiger Investment Co., up 137.53%, and sixth placed Red Tiger Investment Co., up 122.6%.
The Arlington County Retirement System, Arlington, Va., with $800 million in assets, hired Ashford Capital Management as its new consultant to replace SEI, said Bruce O. Kallos, administrator. SEI did rebid for the job, Mr. Kallos said.
The first task will be to optimize the fund's asset allocation and restructure the fund's domestic stock portfolio, Mr. Kallos said. Ashford is expected to make recommendations in about three months.
Ashford's recommendations could result in changes in the money manager lineup, Mr. Kallos said.
John V. Murphy was named vice president in charge of Massachusetts Mutual Life Insurance Co.'s pension management business. Mr. Murphy replaces John M. Naughton, who retired. Mr. Murphy had been executive vice president and chief operating officer at David L. Babson & Co., a Mass Mutual subsidiary