Massachusetts Pension Reserves Investment Management board on Tuesday hired Russell Implementation Services to manage portions of the foreign-exchange transactions conducted by the $48.1 billion Pension Reserves Investment Trust fund that the Boston-based board oversees.
The board hired Russell to “execute foreign-exchange trades” related to PRIM's private equity and distressed debt investments, which account for a combined 4.73% of MassPRIM's annual forex trading volume, as well as for other managers with allocations from PRIM that “lack the resources to trade FX on their own,” according to staff materials distributed at Tuesday's meeting.
An RFP was issued in September.
Separately, the board approved direct investments in a second group of 10 hedge funds as part of an initiative aimed at achieving better returns and lower fees than PRIM’s existing hedge fund-of-funds program. An initial eleven hedge fund managers had been hired in October.
Approved on Tuesday were equity long/short hedge fund managers Ascend Capital, with an initial allocation of $30 million; Indus Capital Partners and Samlyn Capital, $25 million each, and Glenview Capital Management, $15 million.
Event-driven managers that were hired were Davidson Kempner Capital Management, Highfields Capital Management and Pershing Square Capital Management, each with $25 million in initial allocations.
Also given $25 million initial allocations were Brigade Capital Management, a credit/distressed manager; Capula Investment Management, a market-neutral manager and Winton Capital Management, a global macro manager.
Stephen L. Nesbitt, CEO of PRIM's hedge fund consultant, Cliffwater, said Tuesday that an additional handful of hedge fund managers may eventually join the 21 managers the board has hired since October, but for the most part the current lineup can support billions of dollars of direct hedge fund allocations.
The board also committed up to $100 million to buyout fund Providence Equity Partners Fund VII; up to $100 million to middle-market buyout fund Thoma Bravo Fund X; up to $130 million to Crescent Mezzanine Fund VI and up to $100 million to mezzanine fund GSO Capital Opportunities Fund II.