CalPERS staff recommended seven active developed market equity managers and four active emerging market equity managers for two new pre-approved lists of managers from which officials at the $210 billion system can select.
Staff of the $210 billion California Public Employees' Retirement System, Sacramento, recommended the following developed market managers: AXA Rosenberg Investment Management; Batterymarch Financial Management; Fidelity Management Trust; Goldman Sachs Asset Management; PanAgora Asset Management; State Street Global Advisors; and Boston Co. Recommended active emerging markets managers were Batterymarch, Lazard Asset Management, Pictet Asset Management and Robeco Institutional Asset Management.
AXA Rosenberg already manages a $1.1 billion active European equity portfolio for CalPERS, and Robeco manages a $513 million developed market stock portfolio for the system.
If approved at the May 15 investment committee meeting, staff will be able to fund the portfolios at its discretion. No amounts are provided, and there are no plans to change CalPERS' 20% target allocation to international stocks. Funding for the developed market portfolios would come primarily from a $13.7 billion passively managed equity portfolio run by SSgA or from existing active international managers. Funding for new emerging market portfolios would come from cash flows or from existing emerging market managers.
In addition, staff recommended renewing the contracts for all four of the fund's high-yield bond managers for one year: Nomura Asset Management: $486 million; PIMCO, $461 million; ING Ghent Asset Management, $313 million; and Highland Capital Management, $219 million in a distressed bank loan portfolio.
Wilshire Associates consulted on both the international equity and high-yield bond reviews.