Thursday, December 14, 2017
Core Fixed Income Allocation Mandates Approved
At its December 13, 2017 meeting, OCERS’ Investment Committee approved an initial $125 million allocation each to Longfellow Core and Schroder Value Core Strategies.
In January 2017, the Investment Committee voted to adopt a new asset allocation. In March, the Committee adopted the target ranges around each asset class. Core Fixed Income is the third largest asset class of the adopted asset allocation with a 17 percent target. Core Fixed Income is currently 13.4 percent of the portfolio.
“Longfellow and Schroders’ complementary approaches in managing core strategies would be highly additive to OCERS’ investment manager line-up,” Chief Investment Officer Molly A. Murphy said in her written report presented to the Committee.
The initial allocation of $250 million is approximately 12.4 percent of the current core fixed income allocation or 1.7 percent of the total fund.
Benchmark Recommendations Adopted
In other action taken on December 13, the Committee approved new benchmark recommendations that reflect risks associated with OCERS’ new asset allocation adopted during the first quarter of 2017.
At the December 13, 2017 meeting, the Committee approved benchmark recommendations developed by OCERS’ Investment staff and Meketa Investment Group (OCERS’ investment consultant). The Committee adopted an updated total portfolio Policy Index and the following updated asset class level benchmarks:
Real Assets, including the underlying Real Return sub-asset class
Risk Mitigating Strategies
The approved benchmark recommendations will go into effect on January 1, 2018.
OCERS’ Regular Board of Retirement will meet at 9:00 a.m. on Monday, December 18, 2017.