The overall international equity target remains unchanged at 21%, but within the asset class, the 3% target to international developed markets small-cap equities was eliminated, and the targets to international developed markets increased to 15% from 12.5% and emerging markets to 6% from 5.5%.
The target to total fixed income was dropped to 22% from 26%. Within the asset class, the target to multistrategy credit was increased to 8% from 4%, while the target to core fixed income was dropped to 12% from 15%, the 4% target to global sovereign ex-U.S. fixed income was eliminated, and emerging markets debt (local currency) was dropped to 2% from 3%.
The overall target to alternatives was increased to 16% from 14%. The asset class is made up of private equity (raised to 8% of the total pension fund from 6%) and private credit (unchanged at 8%), and the overall target to real assets was increased to 12% from 11%. Within that asset class, the target to value-added and opportunistic real estate was raised to 4% from 3% while the targets to core real estate and infrastructure remain unchanged at 4%.
FCERA staff has prepared an implementation plan for approval at the next board of trustees meeting on Wednesday, Mr. Kidd said.
"Since this will take quite a bit of time and several steps, there will be several points of consultation with the board to make sure they are OK with the implementation of their vision," Mr. Kidd said. "Some changes, such as with real estate and private equity may even take years to achieve."
As of Sept. 30, the actual allocation was 27.8% domestic equities, 27.1% global fixed income, 20.3% international equities, 7.4% private credit, 6.5% private equity, 4.8% real estate, 3.3% infrastructure, 1.5% cash and equivalents, and the rest in other.