Arizona Public Safety Personnel Retirement System, Phoenix, tentatively approved hiring BlackRock to manage up to $200 million in global TAA, in both separate accounts and commingled funds, confirmed James Hacking, administrator of the $6 billion system.
Along with the hiring, the system added $80 million to Bridgewater's existing GTAA portfolio, raising it to $200 million. The mandate is part of the system's global equity portfolio.
“The (GTAA) strategies seek to exploit inefficiencies across global markets,” Mr. Hacking said in a telephone interview.
The system also hired Crestline Investors and FrontPoint Partners to run $150 million each in the system's first allocation to portable alpha strategies.
Mr. Hacking said funding for the GTAA and portable alpha hires will come from the system's equities exposure, much of which is currently in index funds run by SSgA, adding that the portable alpha strategies aim to “add value above index returns.”
All hires are subject to subject to due diligence.
Separately, the system committed up to $40 million to Littlejohn Fund IV. “Littlejohn will make (private equity) investments in what they call middle-market companies, primarily in manufacturing and distribution,” he said. “They are companies that are underperforming or distressed.”
Millennium Technology Value Partners II received a commitment of up to $20 million. Mr. Hacking said the fund specializes in secondary direct investments in venture-backed technology companies.
The system also increased its investment in the ORGAZ Secondary Opportunity Fund, a fund jointly owned with ORG, to $65 million from $40 million. Additionally, the board added $25 million to its original $40 million investment in Timbervest Partners.
Mr. Hacking also said that for the first seven months of the fiscal year — July 1, 2009, through Jan. 31 — the rate of return for the overall fund was 14.16%, compared to the custom benchmark return of 12.9%. The system's asset allocation as of Jan. 31 was 29.8% U.S. equities, 21.12% fixed income, 19.41% non-U.S. equities, 9.74% real estate, 7.1% credit opportunities, 6.78% private equity, 4.91%; real assets, and 1.14% short-term investments or cash equivalents.