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 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%,
Rounding out the top five for the year were third-place Firebird Fund, a Russian fund that rose 145.61%, and fourth-placed Mercury ST Eastern European Fund, up 137.95%.
SEARCHES & HIRINGS
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 for the $67.8 billion California State Teachers Retirement System, Sacramento, is 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 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. SEI did rebid for the job, Mr. Kallos said..
The fund has nine investment managers, plus two real estate managers, and Ashford's recommendations could result in changes in the lineup of money manager, Mr. Kallos said.
The Navajo Nation, Window Rock, Ariz., named finalists in its search for a new consultant.
Callan Associates, William Mercer Consulting and R.V. Kuhns & Associates will be interviewed at the February investment committee meeting. A decision is expected then, said Martin E. Ashley, accounting manager.
The consultant will monitor manager performance and determine asset allocation for the nation's general, endowment and retirement funds.
SEI had been the consultant and was included in the RFP process, he said.
El Paso County, Colorado Springs, Colo., hired Segal Advisors as actuary for its $115 million pension plan. Other finalists were incumbent William M. Mercer and Buck Consultants. Segal's first job will be to do an actuarial evaluation of the fund, said Mike Cherry, plan administrator