Los Angeles Fire and Police Pension System’s board plans to review whether to continue its hedge fund and private equity programs, according to a strategic plan adopted at the board’s April 1 meeting.
The asset allocation study is expected to be launched at the board’s Thursdaymeeting, wrote Michael A. Perez, general manager of the $13.2 billion system, in an e-mail response to inquiries.
The board also plans to review its roster of investment managers and eliminate or replace “marginal or underperforming investment managers,” for potential cost savings and greater investment returns, according to the strategic plan.
The board also expects to incorporate risk and liquidity considerations into the asset allocation.
The target allocation for private equity is 10% of total plan assets and the target allocation for hedge funds is 5%.
System officials would complete their individual program reviews by Oct. 31 and complete the asset allocation process by Jan. 31, 2011. Any decisions on manager changes would be implemented by June 30, 2011.
System officials typically conduct an asset allocation study every three to five years; the last study was completed in January 2007.
R.V. Kuhns, the system’s general consultant, is assisting.