Michigan Department of Treasury, Bureau of Investments, sold $1 billion in active and passive U.S. equities and active international stocks managed for the $45 billion Michigan Retirement Systems, East Lansing, to meet pension benefit payments in the first quarter, according to minutes from the bureau's June 2 Investment Advisory Committee meeting released Sept. 2.
Jon M. Braeutigam, the bureau's director and chief investment officer, explained to committee members that the system “takes advantage of the swings in the markets to determine where the cash will be taken (from) to pay benefits,” according to the minutes. The minutes noted that “raising cash to pay benefits” happens on a quarterly or six-month basis. “Raising cash from equities in the first quarter was the right decision,” Mr. Braeutigam said, according to the minutes.
According to the minutes, the system also invested an additional $203 million in the customized hedge fund-of-funds portfolio managed by Aetos Capital.
Information about potential asset allocation changes and the size of Aetos' previous mandate were not available; Mr. Braeutigam did not return a call seeking more information.
