New Jersey Division of Investment, Trenton, could be required to issue quarterly reports comparing the investment returns of the $62 billion system’s internally and externally managed portfolios with recommendations on whether the external managers should be retained.
The requirement is part of a bill from state Assemblyman Reed Gusciora, who said in an interview he’s concerned about the alternative investment strategy established in 2005 that has been run by external money managers.
He said the monthly report now submitted by the division does not provide enough information about how well external money managers are performing compared to those employed by the state. Existing law requires monthly and annual reports from the division, but they do not compare internal and external portfolio performance.
“We’re not tracking and comparing the two,” Mr. Gusciora said. “If private money managers do better, then I can’t see why we can’t find that out. If they are doing worse, then we should know that, too.”
As of Oct. 31, about 17.2% or $10.7 billion, of the division’s assets were invested in alternatives, said New Jersey Department of Treasury spokesman Tom Bell.
The division, which oversees state pension assets, has seen its value drop by 20% from Jan. 31 through Oct. 31.
William Clark, division director, could not be reached for comment by press time.
