The $33.2 billion Illinois Teachers Retirement System, Springfield, began a search on Friday for a TIPS manager to run $265 million to $318 million, confirmed R. Stanley Rupnik, acting executive director and chief investment officer.
The new portfolio was approved by TRS trustees at their board meeting Thursday and is the fund's first dedicated TIPS allocation, Mr. Rupnik said in an interview. The plan had about $3.2 billion invested in domestic and international inflation-protected securities as of Sept. 30. Funding will come from a reduction in the enhanced passive and total return accounts in the fixed-income portfolio.
The selected firm's portfolio would be between 5% and 6% of the fund's $5.3 billion fixed-income portfolio, according to the RFP which is available at the system's website, http://trs.illinois.gov/subsections/investments/searches.htm. Proposals are due Dec. 31.
Separately, the system increased allocations to two existing global inflation-linked bond managers, adding $284 million to PIMCO and $86 million to New Century Advisors. PIMCO now runs a $676 million portfolio for the system; New Century, $160 million.
The system also added $133 million to Franklin Advisors to manage in active international fixed income, bringing the manager's total to $919 million.
Mr. Rupnik also said trustees approved committing up to $100 million to Morgan Creek Partners Asia fund, the system's first to a dedicated Asian-focused fund. Up to $75 million was committed to EnerVest Institutional Fund XII an oil and gas specialty private equity fund.