Phoenix City Employees’ Retirement System hired State Street Global Advisors to manage about $130 million in a Treasury inflation-protected securities index fund, said Greg Fitchet, investment officer.
The $2.3 billion pension fund’s board approved the investment at its June 1 meeting. Funding will come from the impending redemption of a hedge fund-of-one separate account managed by Pacific Alternative Asset Management Co. The pension fund’s general investment consultant, Meketa Investment Group, recommended the redemption from the strategy due to the February announcement of the merger of PAAMCO and KKR Prisma into a new firm, as well as the pension fund’s recent drop in its hedge fund target to 5% from 15%. The board had approved the redemption at its April 6 meeting.
Also, the pension fund’s board at its June 1 meeting approved a direct investment in hedge fund BH-DG Systematic Trading, a joint venture of Brevan Howard and David Gorton.
An exact amount of the investment has yet to be determined, but funding will come from the partial redemptions of Carlson Capital’s Double Black Diamond Fund and Fir Tree Partners’ Value Fund, both global macro funds in which the pension fund has $55 million and $60 million invested, respectively. Mr. Fitchet said the intention is for the three funds to total $115 million.
Meketa Investment Group assisted.