CalPERS staff recommended hiring Goldman Sachs Asset Management and Franklin Templeton Institutional to run concentrated growth and all-cap growth stock portfolios, respectively. If approved by the $151 billion California Public Employees Retirement Systems investment committee on May 13, staff then will determine how to reallocate CalPERS $4 billion in externally managed domestic growth stock assets to fund the new portfolios.
Four of the Sacramento-based systems five existing growth-equity managers have underperformed their benchmarks; three use very quantitative styles; and all invest primarily in large-cap stocks. Goldman Sachs currently manages $790 million in domestic growth stocks for CalPERS and is on probation for performance, according to Wilshire Associates. Other existing growth-stock managers are Brown Capital; Geewax, Terker; Oak Associates; and Putnam Investments.