Seattle City Employees Retirement System hired Quellos Group to run $10 million in a portable alpha strategy, said Mel Robertson, CIO of the $2.1 billion fund. This is the fourth Quellos hedge fund in which Seattle invests.
Funding comes from terminating Bear Stearns, which ran an $80 million active domestic hybrid equity portfolio for the fund. Bear Stearns was terminated for lagging performance and personnel changes at the firm, Mr. Robertson said. Russell Sherman, a Bear Stearns spokesman, did not return a phone call by press time seeking comment.
The fund will put $60 million of the Bear Stearns portfolio into an existing Russell 3000 index fund managed by BGI, which now has $120 million. The remaining $10 million will go into the systems internally managed portable alpha test program, raising it to $20 million.