The Pennsylvania State Employees' Retirement System, Harrisburg, approved a new target asset allocation for the $22.7 billion defined benefit plan, resulting from the plan's regular five-year asset-liability study.
Peter Gilbert, CIO, said the new targets are: 30% domestic equities, from 33%, (20% of total assets in absolute return strategies are included in the U.S. equity target, up from 10%); 15% domestic core fixed income, from 20%; 13% international equities, from 15%; 5% high-yield bonds, from 4.5%; 4% to Treasury inflation-protected securities, a new allocation; 4% emerging market equities, from 3%; 4% emerging market debt, from 0.5%; and 3% for commodities, from 2%. The alternative investment target, including private equity, venture capital and distressed securities, remains at 14% and the real estate allocation also is the same at 8%. Mr. Gilbert said the plan has a five-year period in which to meet the target allocations.
Rocaton Investment Advisors is consultant.