LACERA selects new asset allocation, expands risk mitigation, credit

Los Angeles County Employees Retirement Association, Pasadena, Calif., selected a new asset allocation that increased its risk reduction and mitigation asset class by 5 percentage points to 24% and credit by 2 percentage points to 13%.

The $77 billion pension fund’s new asset allocation also lowers its growth allocation by 5 percentage points to 48% and reduces real assets and inflation hedges by 2 percentage points to 15%. The board at its April 10 meeting adopted the new asset allocation after conducting an asset-liability study.

Separately, LACERA committed a total of $350 million to three alternative investment funds. The board committed $125 million each to Orion Mine Finance Fund IV L.P., a real assets fund investing globally in metals and precious metals needed for the clean energy transition and Orion Mine Finance Co-Fund IV, a co-investment vehicle with a similar focus. Both funds are managed by Orion Resource Partners.

Pension officials also committed $100 million to Innovation Alpha V, a middle market buyout fund focused on investing in diversified sectors in Japan. The fund is managed by Summit Management.