CalPERS to invest $11bn by 2020 with 'transition managers'

The California Public Employees’ Retirement System (CalPERS) is looking to invest up to $11bn with ‘transition’ investment managers by 2020.

The move is an extention of the US pension fund’s emerging manager programme, whereby the US pension fund invests in newly formed or relatively small companies.

Transition managers are emerging managers that have “demonstrated early stage success” either wihin the programme or elsewhere, CalPERS said.

The US pension fund will hold a global solicitation process – starting in July next year – that will seek investment proposals from mid-size external investment managers.

Real estate is included in the programme. CalPERS plans commitments in the range of $50m to $300m for transition real estate managers.

Laurie Weir, investment director at CalPERS, said: “Our objective for investing with emerging and transition managers is to generate appropriate risk-adjusted investment returns by identifying early funds with strong potential for success; accessing unique investment opportunities that may otherwise be overlooked; and cultivating the next generation of external portfolio management talent.

“We hope this advance notice will give managers time to learn more about CalPERS’ programs and prepare their proposals.”