Ohio Police & Fire Pension Fund, Columbus, hired Parametric Portfolio Associates as discretionary manager of a commodities fund of funds portfolio totaling $350 million, spokesman David Graham said in an email.
The $17.3 billion pension fund's investment committee approved the hiring of Parametric at its meeting on Wednesday, Mr. Graham said.
The hiring is the result of the pension fund's board in August approving the creation of a new dedicated 2% target allocation to commodities. Other changes at the time were increases to core fixed income to 25% from 23% and private equity to 10% from 8%, and decreases to domestic equities to 18.6% from 21%, U.S. Treasury inflation-protected securities to 15% from 17% and international equities to 12.4% from 14%. Mr. Graham said at the time no managers would be terminated as a result of the target changes.
Targets that remained unchanged are 12% real estate, 8% real assets, 7% high-yield bonds and 5% each gold, midstream energy infrastructure and private credit. The pension fund portfolio's target allocation totals 125% "due to the implementation of leverage in core fixed income and U.S. inflation-linked bonds and the implementation approach for gold," according to its website.
Parametric's strategy will seek "to avoid some of the concentrations found in many commodities indices, invest more broadly across commodity types and sectors and includes a number of commodities not found in the broader indices," Mr. Graham said.
Also on Wednesday, the investment committee approved a commitment of up to $40 million to middle-market buyout fund Cortec Group VIII. The pension fund previously committed up to $20 million to Cortec Group VII in 2019.
The pension fund's current allocation to private markets is 8.3%.