Los Angeles Water & Power Employees' Retirement Plan's has approved a search for an active unconstrained global equity manager to run up to $377 million for its $16.4 billion defined benefit plan.
The board at its Sept. 27 meeting approved issuing an RFP for a second unconstrained global equity manager to complement current manager Boston Partners, said Jeremy Wolfson, chief investment officer.
The timeline for the RFP has yet to be determined. The search is the result of an increase in the target to unconstrained global equities to 10% of the DB plan's overall 46% target to global equities from 6% following a structural review conducted by staff and investment consultant RVK.
Boston Partners currently manages about $433 million in its unconstrained strategy, and its portfolio will be reduced to about $377 million so the two managers will run equal amounts, Wolfson said.
Other changes to targets within the overall global equity target are reductions to active domestic large-cap value to 17% from 18.9%, active international large-cap to 15% from 20%, active large-cap growth to 15% from 18.9% and active emerging markets to 11% from 11.3%, and increases to passive domestic large cap to 11% from 9.4%, passive international large cap to 9% from 7.1%, active international small cap to 6% from 4% and active domestic small-cap growth and active domestic small-cap value to 3% each from 2.2% each.
Funding for increased targets will come from portfolio reductions as a result of the reduced targets, and no managers will be terminated.
RVK will assist with the search.