Dallas Police & Fire Pension System hired Boston Partners and Manulife Asset Management to run an initial $80 million each in global equity as part of the pension fund’s restructuring of its global equity portfolio, a recently released board meeting summary shows.
The pension fund also terminated Fidelity Institutional Asset Management from a global equity strategy totaling about $114 million.
Existing global equity managers OFI Global Asset Management and Walter Scott & Partners, which ran $118 million and $85 million, respectively as of March 31, have been retained.
Funding sources for Boston Partners and Manulife could not immediately be confirmed.
The combination of Boston Partners, Manulife, OFI and Walter Scott, “produces a diversified portfolio that should perform well in different market environments by capitalizing on different risk premium,” said the pension fund’s investment staff in a June 9 letter to the board. “OFI is focused on the growth premium, Walter Scott captures the quality premium, Boston Partners captures the value and market cap premiums by providing exposure to small- and midcap value stocks, and Manulife is focused on the value premium in large-cap stocks.”
Further information on Fidelity Institutional’s strategy and the reason for its termination could not immediately be learned.
In March, the $2.7 billion pension fund voted to raise its global public equity target to 25% of the overall fund, up from the previous target of 15%, and establish a new 5% emerging markets equity target within the global equity portfolio, as recommended by investment consultant NEPC. The pension fund does not currently have any dedicated emerging markets equity managers.
The investment staff, in consultation with NEPC, also recommended that the new global equity structure have a better balance of growth and value stocks.
Kelly Gottschalk, executive director, could not immediately be reached for additional information.