Oregon Investment Council, Tigard, which runs the $68.3 billion Oregon Public Employees Retirement Fund, Salem, invested up to $800 million each in global low-volatility equity strategies with Acadian Asset Management, Arrowstreet Capital, Los Angeles Capital Management and Equity Research and AQR Capital Management, spokesman James Sinks said.
The investments were made at the council's meeting Wednesday as part of its shift of about 25% of its equity portfolio to a low-volatility strategy. Los Angeles Capital is the only new relationship.
The council also voted to invest $1.2 billion in an internally managed international risk premiums equity portfolio. As of Sept. 30, the staff internally managed 19% of the pension fund's $26.1 billion global public equity portfolio.
Funding came from portfolio rebalancing over the 15 months ended Sept. 30 that included terminating three externally managed active mandates — $741 million in core domestic smidcap equity managed by Columbia Wanger Asset Management; $600 million in domestic large-cap equity managed by Pacific Investment Management Co.; and $98 million in domestic small-cap equity managed by Next Century Growth Investors — and two internally managed allocations, a $1.4 billion passive equity strategy that follows the Russell Fundamental index and a $180 million emerging markets equity strategy.
Separately, the council committed $250 million to AQR Futures Strategy Fund. This is Oregon's first commitment to a managed futures strategy.
The council also committed $200 million to MBK Partners IV, a buyout fund targeting control-orientated investments in South Korea, Japan and China. The fund has a $3.5 billion target and a $4 billion hard cap. Oregon has not invested with MBK Partners in the past.
The council also extended for two years the contracts of general investment consultants Callan Associates and Pension Consulting Alliance until Dec. 31, 2018.
