Contra Costa County Employees' Retirement Association, Concord, Calif., nearly doubled its target to private equity and decreased its target to hedge funds by more than half following the completion of an asset-liability study.
The $9.5 billion pension fund's board approved the new asset mix at its Dec. 9 meeting, CEO Gail Strohl said in an email.
The pension fund's target allocation is categorized by growth, liquidity and diversifying portfolios.
The overall growth portfolio target increased to 76% from 67%. Within that portfolio, only the targets to value-added real estate and infrastructure remain unchanged at 5% and 3%, respectively, of total plan assets.
Also within growth, the pension fund increased targets to private equity to 15% of total pension fund assets from 8%, private credit to 13% from 12%, domestic large-cap equities to 10% from 5%, and opportunistic real estate to 5% from 4%. CCCERA also added a newly-created 3% target of domestic small-cap equities.
Also in the growth portfolio, the pension fund reduced international developed markets equities to 10% of total pension fund assets from 13%, emerging markets equities to 8% from 11%, and risk parity to 3% from 5%. CCCERA eliminated its 1% target to real estate investment trusts.
For its overall liquidity portfolio, the pension fund reduced that overall target to 17% from 23%. Within that portfolio, CCCERA created a new 3% target of total pension assets to cash and reduced the target to short-term credit to 14% of the overall pension fund assets from 23%.
For its diversifying portfolio, the pension fund reduced the overall target to 7% from 10%. Hedge funds were reduced to 3% of total pension fund assets from 7%, a U.S. Treasuries target of 3% was eliminated, and the pension fund created a new 4% target to core fixed income.
Investment consultant Verus Advisory assisted.