The Teacher Retirement System of Texas (TRS) plans to increase its weighting to real assets as a result of a recent strategic asset allocation study.
The pension fund will increase its allocation to real estate from 14% to 15% and its allocation to energy, natural resources and infrastructure from 5% to 6%.
The changes could mean more than $3bn (€2.64bn) of capital is diverted to real assets based on Texas TRS having $152.5bn of assets at the end of March 2019.
The pension fund’s policy committee is expected to recommend a phased-in period of up to six months to allow the pension fund to reach its new allocation targets.
The board of trustees voted to accept the recommendations of its latest five-year asset allocation study at last week’s board meeting.
Joe Colonnetta, board of trustees’ investment management committee chairman, said: “The newly-approved changes increase the probability of the system meeting its investment return assumption and provides a better balancing the total trust allocation.”