The University of California General Endowment Fund, Oakland, will increase its absolute-return allocation to 15% of assets from 10%, and cut its allocation to U.S. large-cap stocks to 28% from 34% under a new asset mix adopted Thursday.
The $5.8 billion fund is boosting alternatives and generally making its overall asset mix more in line with those of Stanford, Princeton, Harvard and Yale universities. The fund will put 2% of assets in private real estate, a new allocation, and at their August meeting, the regents will consider making additional allocations to other real assets. The regents also approved increasing private equities to 3% from 2% of assets.
The fund will slash its U.S. fixed-income allocation to 8% from 20% of assets, while creating new allocations to high-yield debt, non-U.S. fixed income and emerging market debt of 3% each. In addition, TIPS will be increased to 6% of assets from 5%. The fund also has 4% invested in U.S. small-cap equities, 20% in developed markets and 5% in emerging market equities.
Richards & Tierney is the consultant. No further details were available.