State of Wisconsin Investment Board, Madison, approved a slight increase in its target allocation to private equity/debt in the $131.5 billion Wisconsin Retirement System core trust fund.
The board approved the recommendation by investment consultant NEPC at its Dec. 11 meeting, a spokesperson said.
The board approved raising the target to private equity/debt to 20% from 18%, which will be funded by a drop in the target to public equity to 38% from 40%. Targets that remain the same are 27% fixed income, 19% Treasury inflation-protected securities and 8% real estate. The target allocation also includes a -12% target to leverage.
The recommendations were a result of the board’s annual asset allocation review, and the targets will be effective for its fiscal year ending Dec. 31, 2025. In a presentation included with meeting materials, NEPC said the recommended increase in the private equity/debt target is consistent with a 10-year pacing plan established by investment staff to gradually increase the core trust fund’s exposure to private markets.
The presentation said NEPC’s capital market assumptions imply a limited impact to the 10- and 30-year return assumptions for the core trust fund.
As of Sept. 30, the core trust fund’s actual allocation was 33.6% public equities, 23.6% fixed income, 17.5% private equity/debt, 16.9% TIPS, 8.1% real estate and 0.3% cash and overlays.
SWIB oversees a total of $166.4 billion in state assets.
