Road Commission for Oakland County Retirement System, Beverly Hills, Mich., rejiggered its asset allocation, adding a new 10% suballocation to tactical multiasset class strategies within equities and cutting a 2% suballocation to within alternatives.
The new asset allocation for the $185 million pension portfolio is 75% equities, 21% fixed income and 4% alternatives. Previously, the allocation was 60% equities; 35% fixed income and 5% alternatives.
As part of the change, trustees approved the allocation of a total of $33.5 million from longer-maturity fixed-income strategies to reposition the portfolio “in anticipation of Fed tapering,” said Dennis A. Lockhart, plan administrator, in an e-mail.
MPI Investment Management, one of the pension fund's existing short-term bond managers, was given an additional $6.5 million, bringing the total it manages to $13 million.
Two new managers also were hired, Mr. Lockhart confirmed in a telephone interview.
Hilton Capital Management was brought on to run the new tactical strategy: $18 million was allocated to the firm's yield-plus strategy. The strategy is unconstrained, allowing the manager to invest tactically across any asset class, Mr. Lockhart said during the interview.
Also hired was SouthernSun Asset Management to manage $9 million in active U.S. smidcap equity.
The pension fund was assisted in making the changes by Cheryl L. Underwood, senior consultant, Independent Portfolio Consultants.