Could CalPERS go where no US pension fund has gone before?
As the US’s largest public pension fund, managing north of $500 billion-worth of assets, California Public Employees Retirement System has served as somewhat of a bellwether for pension funds across the country. Could the pension fund now be changing the standard of portfolio construction in the US?
During its November 18 meeting, CalPERS’ new chief investment officer, Stephen Gilmore, introduced to the board the concept of a “total portfolio approach”, a method of constructing a portfolio that would eliminate the need for traditional strategic asset allocation.
The total portfolio approach would aim to provide a more holistic and unified approach to both risk and benchmarking, eliminating the silos between asset classes.
Specifically, when looking at risk, Gilmore highlighted that the new approach could...