CalPERS’ staff is recommending that the contracts of high-yield fixed-income managers PIMCO and Nomura Asset Management be renewed for one year. PIMCO handles $212 million and Nomura runs $204 million for the California Public Employees’ Retirement System, Sacramento. Although the managers fell short of its custom benchmark by a combined 133 basis points for the 12 months ended March 31, the combined portfolio has returned an annualized 7.95% since inception in March 2002, vs. 7.73% for the index. The board of the $240.1 billion system will consider the recommendation at its meeting May 12.
Separately, CalPERS reported that its $5.8 billion emerging markets equity portfolio returned 18.63% for the year ended March 31, underperforming its custom benchmark by 1.72 percentage points. The portfolio returned 26.96% annualized in the three years ended March 31, 1.32 percentage points less than the index; but the five-year return of 29.67% was 1.81 percentage points above the benchmark.
