JANUARY 28, 2008                                              Eyes Stakes In GPsVOL. XXXIII, NO. 2                        ...
Money Management Letter                                      www.moneymanagementletter.com                                ...
Reaching Your Goals?Fort Washington offers a wide rangeof financial solutions tailored to meetspecific investment goals for ...
Money Management Letter                                     www.moneymanagementletter.com                                 ...
&                                present... Investing In Emerging Markets February 26, 2008 • Union League Club • New York...
Money Management Letter                                     www.moneymanagementletter.com                                 ...
Premium                    oney Management Letter’s 7th Annual Public Pension Fund Awards for Excellence is held inChocola...
Money Management Letter                                     www.moneymanagementletter.com                                 ...
January 28, 2008                                        www.moneymanagementletter.com                                 Mone...
Money Management Letter                                   www.moneymanagementletter.com                                   ...
January 28, 2008                                                   www.moneymanagementletter.com                          ...
Money Management Letter                                    www.moneymanagementletter.com                                  ...
January 28, 2008                                                                www.moneymanagementletter.com             ...
January 28, 2008                                                                www.moneymanagementletter.com             ...
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Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER  Derivatives - ilija Murisic
Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER  Derivatives - ilija Murisic
Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER  Derivatives - ilija Murisic
Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER  Derivatives - ilija Murisic
Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER  Derivatives - ilija Murisic
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Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER Derivatives - ilija Murisic


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Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER Derivatives - ilija Murisic

Keywords: Carbon, CO2, Emission, EUA, CER, climate change, Index ,Kyoto, UBS, derivatives, hybrids, trading, structured products

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Money Management Letter - Jan 08 - UBS Greenhouse Index - Carbon Emission EUA CER Derivatives - ilija Murisic

  1. 1. JANUARY 28, 2008 Eyes Stakes In GPsVOL. XXXIII, NO. 2 NEW JERSEY SEEKS EQUITYKansas Boosts Real Assets MANAGERS FOR $5-6BThe Kansas Public Employees The New Jersey Division of Investment plans to issue aRetirement System has increased itsreal return allocation to 14% from 10%. $2 billion small-cap RFQ this month and another in See story, page 6 March for $3-4 billion in international equities. The $81 billion fund is also considering direct infrastructure deals, co-In The News investments and funds to reach its target 2% infrastructureSawgrass Expands Client Service 2 (continued on page 19)Watson Wyatt Adds Consultant 2 Nuveen To Raise ProfileSearchesOrange County Seeks Real Estate 2 ANSON THROTTLES UP PRODUCTDenver Ponders Portable Alpha 4 DEVELOPMENT, MARKETINGMissouri Eyes Int’l Real Estate 4 Mark Anson intends to use his high profile and experience at the helm ofChicago Water Studies Alts 4 the California Public Employees Retirement System and BT PensionNashville Preps 130/30 RFP 6 Scheme to attract pension fund clients for his new firm, Nuveen Investments. He is planning to launch investment strategies, hire salesMarketing Strategies Mark Anson professionals and spend more time with clients and prospects.Green Manager Offers New Fund 8 (continued on page 20)PeopleApollo Grabs Pequot Marketer 8 Hedge Funds, Emerging Managers On RadarSSgA U.S. Bond Chief Departs 9 ARKANSAS TEACHERS AIM TO TAME INFLATIONCallan Loses Two Consultants 9 The Arkansas Teachers Retirement System has carved out 5-6% allocation to inflation-Philly Picks Investment Officer 9 hedging strategies, including timber, commodities, infrastructure and Treasury inflation- protected securities. Executive Director Paul Doane expects to start seeking managers in theDepartments first half of this year. So far, the $11.5 billion plan has less than 2% of its assets in timber andPlan Sponsor Profile 10 has heard educational presentations on the other asset classes at recent board meetings. ATRSAsk The Advisor 11 will also hear presentations on hedge funds from Ennis Knupp + Associates and managers atNews Recap 12 (continued on page 19)Search & Hire Directory 13-18COPYRIGHT NOTICE: No part of this publication may MARYLAND INCREASES ALTS, GLOBAL EQUITYbe copied, photocopied or duplicated in any form or by The State Retirement & Pension System of Maryland has increased its target allocations toany means without Institutional Investor’s prior writtenconsent. Copying of this publication is in violation of the alternatives, international and global equity. The fund raised its real return and privateFederal Copyright Law (17 USC 101 et seq.). Violators equity targets to 5% each from 2%, real estate to 10% from 5%, global equity to 15% frommay be subject to criminal penalties as well as liabilityfor substantial monetary damages, including statutory 10% and international equity to 18% from 15%, at a Jan. 15 board meeting. All moves aredamages up to $100,000 per infringement, costs and being funded by reducing domestic equity to 30% from 40% and fixed income to 17%attorney’s fees. Copyright 2008 Institutional Investor,Inc. All rights reserved. ISSN# 720-90190 from 28%, said John Greenberg, chief investment strategist. Following an asset study, EnnisFor information regarding subscription rates Knupp + Associates recommended these changes to help achieve the fund’s 7.75% targetand electronic licenses, please contact Dan Lalor at(212) 224-3045. (continued on page 19) Remember to check www.moneymanagementletter.com during the week for breaking news and updates.
  2. 2. Money Management Letter www.moneymanagementletter.com January 28, 2008Watson Wyatt Adds Consultant Emily Barger has joined Watson Wyatt Worldwide in Atlanta as an investment consultant, working with DB and DC EDITORIAL PUBLISHING corporate retirement plans. She previously worked at Hewitt TOM LAMONT BRISTOL VOSS Publisher Associates alongside Weston Tompkins, now leader of Editor (212) 224-3628 STEVE MURRAY investment consulting for Watson Wyatt’s Atlanta office. Deputy Editor ARCHANA MARWAHA Associate Marketing Manager Barger left Hewitt to study for her MBA at The University of DOUG CUBBERLEY (212) 224-3421 Executive Editor North Carolina and has also worked in investment banking, VINCENT YESENOSKY Weston Tompkins EMMA BLACKWELL Senior Operations Manager at Wachovia and Cratos Capital Partners. Managing Editor (212) 224-3057 (212) 224-3279 Barger’s position was created in response to rapid growth in the firm’s client CHRISTOPHER FLORES DAVID SILVA Senior Fulfillment Managerbase, said Tompkins. When he joined in August 2006 the Atlanta office had 30 Reporter (212) 224-3271 (212) 224-3573clients; it has since grown to 40. ANASTASIA DONDE SUBSCRIPTIONS/ Reporter ELECTRONIC LICENSES (212) 224-3635 One year - $2,595 (in Canada add $30Sawgrass Hires Client Service Exec. LOUIS POPE IISearches Manager (212) 224-3211 postage, others outside U.S. add $75). DAN LALOR Sawgrass Asset Management has hired Gregg Gosch as its first STANLEY WILSON Director of Sales (212) 224-3045 dedicated client service professional. He was a managing director Washington Bureau Chief STEVE MCDERMOTT (202) 393-0728 Account Executive at Comsys, Inc., responsible for client relationship operations. KIERON BLACK (212) 224-3486 “We’ve been growing very fast and we wanted to add real depth Sketch Artist THEODORE HEALEY Account Executive [London] to our client service,” said Brian Monroe, director, sales and PRODUCTION (44-20) 7779-8704 marketing. “Our goal is to treat our clients like prospects.” DANY PEÑA Director REPRINTS The Jacksonville, Fla., firm has grown to $1.8 billion LYNETTE STOCK, DEBORAH ZAKEN DEWEY PALMIERI Gregg Gosch Managers Reprint & Permission Manager under management from $1.1 billion just over a year ago, (212) 224-3675 dpalmieri@institutionalinvestor.com MICHELLE TOM, MELISSAprimarily in its large-cap growth equity strategy. “Sawgrass has done a great job ENSMINGER, BRIAN STONE, JAMES BAMBARA, JENNIFER BOYD CORPORATEof client service, with sales and portfolio people having a lot of client face time,” Associates GARY MUELLERsaid Gosch. “I’m hoping to let everyone focus more on what they’re great at.” JENNY LO Chairman & CEO Web Production & Design Director CHRISTOPHER BROWN MARIA JODICE PresidentOCERS Seeks Real Estate Managers Advertising Production Manager (212) 224-3267 STEVE KURTZ Chief Operating OfficerThe Orange County (Calif.) Employees Retirement System will seek two ADVERTISING AND ROBERT TONCHUK BUSINESS PUBLISHING Director/Central Operations & Fulfillmentcommingled core real estate funds to handle $46 million in aggregate. Trustees JONATHAN WRIGHT Customer Service: PO Box 5016,approved the search at a Jan. 22 meeting. CB Richard Ellis Investors and America Publisher (212) 224 3566 Brentwood, TN 37024-5016. Tel: 1-800-715-9195. Fax: 1-615-377-0525Realty Advisors handle $576 million in separate account real estate mandates. ERIK KOLB UK: 44 20 7779 8704 Editor, Business Publishing Hong Kong: 852 2842 6910Over five years, all this money will be moved into open-ended commingled funds. (212) 224-3785 E-mail: customerservice@iinews.comThe latter provide better liquidity and diversification, lower fees, less price volatility PAT BERTUCCI, MAGGIE DIAZ, Editorial Offices: 225 Park Avenue LANCE KISLING, ADI HALLER, South, New York, NY 10003.and more transparency, according to the fund’s consultant, Callan Associates. Associate Publishers Tel: (212) 224-3279 Email: eblackwell@iinews.com Separately, the $8 billion fund selected Schroder Investment Management LESLIE NG Advertising Coordinator Money Management Letter is ato handle $70 million in active commodities and Wellington Management (212) 224-3212 general circulation biweekly. No statement in this issue is to be construedCo. to manage $50 million in a Diversified Inflation Hedges strategy. The fund as a recommendation to buy or sell securities or to provide investment advice.also chose PIMCO to oversee $70 million in passive commodities and The Money Management Letter ©2008Clifton Group for $130 million in a cash overlay strategy. These allocations Institutional Investor, Inc. ISSN# 720-90190should protect against inflation while achieving higher returns than Treasury- Copying prohibited without the permission of the Publisher.inflation-protected securities. Schroders’ strategy uses top-down analysis and selects companies globallythrough fundamental and quantitative research. Wellington’s multi-asset portfolioinvests in commodities, inflation-linked bonds and global equities. PIMCO hasbeen managing money for OCERS for the past 25 years. The firm has a proventrack record, strong risk analysis and impressive client service, wrote InvestmentAnalyst Amit Thanki in a memo. The Clifton Group was selected for its focus oncash overlay and long-standing relationships with California pension funds.2 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  3. 3. Reaching Your Goals?Fort Washington offers a wide rangeof financial solutions tailored to meetspecific investment goals for institutionsand wealthy individuals.• Institutional Equity and Fixed Income• Private Equity• Wealth Management 513-361-7600 • 1-888-244-8167 www.fortwashington.com FW-758-0708
  4. 4. Money Management Letter www.moneymanagementletter.com January 28, 2008 SearchesDenver Schools Study managers. Albourne America advises the plan on hedge funds. The system started investing in private equity two years ago. ItPortable Alpha has a 10% target but only 3% is actually invested. Krummen is The $2.9 billion Denver Public Schools seeking hedge funds that could function as private equity Retirement System will study portable alpha surrogates while he waits for his private equity managers to make in the coming months and may make an capital calls. These are mostly long/short equity funds with a allocation in March. The board considers long bias that aim to deliver equity-like returns with lower portable alpha a good diversifier and return volatility. Activist hedge funds could fit here, too. Krummen is generator, said CIO Gary Ratliff. The concerned about equity markets in general and wants to reduce allocation would likely focus on large-cap equity risk without sacrificing returns. Gary Ratliff U.S. equity. “It’s getting hard to finddomestic long-only managers that can add value,” he said. “Thisway we can increase alpha and still have that U.S. large-cap Norfolk’s New Board Tobeta.” Ratliff declined to speculate on how much might be Consider Altscommitted to portable alpha or if mandates would go to new or The $900 million Norfolk (Va.) Employees Retirementincumbent managers. System may consider initial investments in alternative asset classes such as private equity and hedge funds this year. In 2007Reviewing Hedge Funds the fund’s board had 100% turnover and as of December had the necessary eight members in place to make investmentMissouri Fund Preps Int’l Real decisions, said CIO Kamal Khanna. The previous board, whichEstate Move had the same chairman for 18 years, had consistently decided The $1.8 billion Missouri Department of against alternatives. “What do we think of private equity? What Transportation & Patrol Employees do we think of hedge funds? They will be asking all these Retirement System is planning to invest in questions,” Khanna said. Any decision would be many months international real estate and reviewing a host away and he would prefer not to receive manager solicitations of hedge fund strategies for diversification. until that time. The fund has 15% of its assets in domestic The new board will also do a complete review of its traditional private real estate, although its target is only 60% equities, 40% fixed-income asset allocation. “They will Larry Krummen 13%. CIO Larry Krummen is working with decide from scratch what they will do,” said Khanna. Among theSummit Strategies Group to diversify the portfolio and is challenges the new board will face will be finding a replacementresearching whether to use international real estate investment for Khanna as cio when he retires in June 2009. Summittrusts or private real estate. He wants to come up with a game Strategies Group advises the fund.plan by the end of the first quarter and seek active managers afterthat. International investments would be funded by rebalancingaway from domestic managers. Windy City Utility Opens Doors To Last year, the board approved hedge funds either as a Alts, Int’l Equitystandalone allocation within the fixed-income portfolio, or as The $1.7 billion Metropolitan Water Reclamation District ofpart of a portable alpha platform. The fund currently invests Greater Chicago pension plan is receiving advice on international20% of its assets in market-neutral hedge funds—7% of which equity and alternatives, such as real estate and hedge funds. It mayare part of its portable alpha program, with the remaining 13% create allocations to these asset classes this year.sitting within its fixed-income allocation. “We have available cash The plan was released from legislative restrictionsto fund additional hires currently under review,” said Krummen. prohibiting these asset classes last summer, said Susan Boutin, The fund is considering Asian and European market-neutral executive director. Restrictions were lifted for all state funds instrategies for diversification. It is also evaluating higher alpha, Illinois almost a decade ago, but MWRD’s conservative boardmore opportunistic hedge funds for inclusion elsewhere in its requested to maintain them. The plan asked for permission toportfolio, such as its 5% opportunistic debt allocation. make international investments last year, but the stateKrummen said he is considering a couple of Asian distressed debt legislature decided to remove all limitations. “They said, ‘You’re4 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  5. 5. & present... Investing In Emerging Markets February 26, 2008 • Union League Club • New York City Seeking Growth Opportunities and Managing Risk in Tomorrow’s Investment Landscape This inaugural one-day forum, produced by Institutional Investor Hear Ab Events in association with ISI Emerging Markets, offers unique and Rew out the Risks ard insights into current and emerging investment trends and in Emer s of Investing opportunities, the risk and rewards specific to different emerging ging Ma market regions, and real-life experiences of investments in corporate rkets! debt, private equity, local currency markets, project finance and more!Hear from a unique selection ofinvestors, asset managers, economists, FEATURED SPEAKERS INCLUDE:strategists, local specialists and other • Allan Conway, Schroder Investment ManagementEM experts on: • Jerome Booth, Ashmore Investment Management Limited• Economic Outlook: Are We Entering a New Era for • Russell Deakin, CRP Emerging Markets?• Analyzing the Macro Imbalances and Risks in • Fulvio Dobrich, Vietcom Bank Fund Management; Galileo Emerging Markets Asset Management LLC• The Impact of the U.S. Economy on Emerging Markets, • Dirk Donath, Eton Park Capital Management including the Sub-Prime Crisis: - Contagion, or the Beginning of a New Bubble? • Hans Humes, Greylock Capital Management LLC• Tools and Strategies from Private Equity Firms, Hedge Funds and Other Emerging Market Investors • Teresa Kong, Barclays Global Investors• Special Focus Sessions - Assessing Drivers for Growth, • Ralph Sueppel, BlueCrest Capital Management Liquidity and Risk in: CHINA & ASIA • LATIN AMERICA & THE CARIBBEAN • INDIA • EASTERN • Poul M. Thomsen, IFC EUROPE • AFRICA • FRONTIER MARKETS To Register: 1.800.437.9997 • Registration@iievents.com • www.iievents.com
  6. 6. Money Management Letter www.moneymanagementletter.com January 28, 2008 Searches (cont’d)being silly. Other state funds have been doing these investments in cash, is about 70% funded. Allan Emkin at PCA advises thefor years and they’re doing fine,’” Boutin recalled. fund and takes calls from managers on its behalf. MWRD approved a 5% international equity allocation inDecember, an amount which could increase later in the year. Theinitial allocation was awarded to State Street Global Advisors. Music City Eyes 130/30,“Right now we’re just filling in holes in our asset allocation with Infrastructure RFPsexisting managers,” Boutin said, adding that new manager The $2.2 billion Metropolitan Government of Nashville &searches would be unlikely until at least mid-year. It is too early Davidson County (Tenn.) Pension Plan will likely issue an RFPto speculate on how much MWRD may allocate to alternatives for a 130/30 manager after a Jan. 29 meeting. An initialor what form the portfolio might take. allocation will be around $100 million, said CIO Fadi BouSamra. The plan considers 130/30 a better means ofMay Seek Managers capturing alpha than long-only large-cap equity. It may alsoKansas Boosts Real Assets, consider issuing an infrastructure RFP at the meeting, but the specifics have not been determined.Int’l Equity BouSamra was appointed cio last May and has been a strongThe $14 billion Kansas Public Employees Retirement System proponent of introducing long/short strategies andhas increased its allocation to real return investments to 14% infrastructure, as well as increasing overall exposure tofrom 10% to help meet its liabilities. This allocation includes alternatives (MML, 08/27).Treasury-inflation protected securities, infrastructure, timber andabsolute return strategies that deliver LIBOR-plus return streams.CIO Vince Smith said manager hires are likely; over the coming North Dakota Tapsmonths, he and his staff will discuss proposals for implementing JPMorgan, Prudentialthis increase with the board. The move follows an asset study by The North Dakota State Investment BoardPension Consulting Alliance that focused more closely on has committed $60 million to JPMorganliabilities than past studies. The Sunflower State will cut its fixed- Asset Management’s Infrastructure Investmentsincome allocation to 14% from 19% as it prefers the risk/return Fund and $75 million to Prudentialprofile of real assets to bonds. Investment Management’s Pru Alpha strategy. International equity will be raised to 25% from 22% and The infrastructure fund fits into thedomestic equity cut to 30% from 35%. Smith said there are $1.4 billion state insurance trust’s exposuremore opportunities in international stock markets. He isn’t sure Steve Cochrane to inflation-protected assets. This 20%whether the fund will hire new managers. It uses Acadian Asset allocation used to be held predominantly in Treasury inflation-Management, Morgan Stanley Investment Management, protected securities, but the board has been graduallyBarclays Global Investors and AllianceBernstein for EAFE and diversifying it. At the end of 2006, North Dakota investedthen Wellington Management Co. and Capital Guardian Trust $100 million of pension fund money into the same JPMorganCo. for global equity. Smith hasn’t decided where the reductions fund. JPMorgan has a top-quality team and a wealth ofin U.S. equity exposure will come from, but said the fund has a resources, said CIO Steve Cochrane, adding that he likes thegood line-up of managers. It uses BGI and Quantitative $2 billion infrastructure fund’s open-ended structure.Management Associates, in addition to portable alpha strategies North Dakota has used Pru Alpha in a cash management poolwith Payden & Rygel Investment Management and Nomura since Aug. 1 and the strategy returned just over 5% in six monthsAsset Management, and an in-house passive Russell 1000 with fairly low volatility. This month’s investment is within aportfolio. Payden & Rygel derives alpha from bonds while portable alpha program—part of North Dakota’s $4.1 billionNomura manages Japanese equity; both mandates employ a U.S. pension trust’s large-cap domestic equity portfolio. Pru Alpha,equity index overlay. which has virtually no correlation to equity or fixed income, reaped The plan will increase real estate to 10% from 8% and private strong rewards from shorting subprime. Cochrane has knownequity to 6% from 5% using a combination of incumbent Prudential’s fixed-income team for years and said Pru Alphamanagers and new opportunities. The fund, which also has 1% provides access to their best ideas on the long and short sides.6 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  7. 7. Premium oney Management Letter’s 7th Annual Public Pension Fund Awards for Excellence is held inChocolate Sponsors M conjunction with Information Management Network’s 13th Annual Public Funds Summit, and recognizes industry leaders that have stood out for excellence over the past year. Last year’s dinner hosted over 200 leaders from every facet of the public funds industry, including more than 90 plan sponsors and consultants. This year’s dinner is expected to enjoy an even greater turnout. Join us as we honor the nominees and announce and award this year’s winners! Lifetime Achievement Award Recipient: Chuck Valdes, Chairman of the Investment Committee, California Public Employees Retirement System Large Public Plan Award Sponsor Award Categories and Nominees Plan Sponsor Awards Manager Awards Individual Awards LARGE PUBLIC PLAN OF THE YEAR ALTERNATIVES MANAGER PUBLIC PLAN CONSULTANT Arkansas Teachers Retirement OF THE YEAR OF THE YEAR System The Blackstone Group Doug Kryscio, Principal and California State Teachers Senior Consultant, Mercer Retirement System Morgan Stanley Investment Management Allan Martin, Partner, New New Jersey Division of Investment Paulson & Co England Pension Consultants Mid-Sized Public South Carolina Retirement System Michael O’Leary, Executive V.P.,Plan Award Sponsor BOND MANAGER OF THE YEAR Callan Associates MIDSIZED PUBLIC PLAN Ashmore Investment Management OF THE YEAR MARKETER OF THE YEAR PIMCO Cincinnati Retirement System James Clarke, V.P. for U.S. Missouri Local Government Loomis, Sayles & Co. Institutional Business, PIMCO Employees Retirement System Kristin Hovencamp, Director of Missouri Department of EQUITY MANAGER OF THE YEAR Table Sponsors Transportation & Patrol Employees Institutional Sales, GAM Baring Asset Management Retirement System Paul Meskiewicz, Managing Dimensional Fund Advisors San Bernardino County Employees Director, Institutional Investment Retirement Association GMO Products, Hartford Financial Group SMALL PUBLIC PLAN OF THE YEAR EMERGING MANAGER Austin Police Retirement Fund OF THE YEAR Haverhill Retirement System Credo Capital Management Louisiana State Police Phocas Financial Retirement System Piedmont Investment Advisors Ohio State Highway Patrol Retirement System Speak up! To convey your support for a nominee, please contact: Emma Blackwell, at 212-224-3279 or eblackwell@iinews.comFor more information on attending or sponsoring the 7th Annual Public Pension Fund Awards for Excellence Please contact: Tracey Redmond, Awards Director, at tel: 212-224-3239, or email: tredmond@iievents.com, or visit the awards website at www.moneymanagementletter.com/mml/2008awards/
  8. 8. Money Management Letter www.moneymanagementletter.com January 28, 2008 Marketing StrategiesHammond Favors Large-Cap Quality fund. They want to hire staff to fill back office positions so they can focus more on marketing. Hammond Associates is recommending that Demand for renewable energy will remain strong as long as oil clients increase their allocations to large-cap prices stay high, Laufer said. Sources of renewable energy will quality growth stocks globally at the expense of then become lucrative in terms of price competition. Negative small-cap. The latter reached full valuation early issues related to fossil fuel will persist, such as climate change. last year and the discrepancy between small- The fund invests in publicly-traded companies globally, but and large-cap valuations grew as 2007 Laufer and Cox think there are considerable investment progressed, said Rich Marra, director of opportunities in the private sector. They will consider launching Rich Marra corporate retirement plans in St. Louis, a private equity fund this year. “There is a lot of entrepreneurialdescribing large-cap growth as a bargain. Large-caps are better innovation in this sector and not every company is ready to be apositioned to capitalize on international growth than more public company,” Laufer said.domestic-oriented small-cap stocks. The investible universe is growing exponentially. When the Hammond’s clients have tilted their portfolios toward growth New Energy Fund was launched in 2004, Sustainable only hadthrough a combination of rebalancing and adding new managers. about 25 public companies to choose from, compared to aroundHammond has recommended both active managers and index 650 now. The fund focuses on supply and demand within thefunds to reduce manager and tracking error risk. “Passive renewable energy sector and holds 30-50 stocks, selectingstrategies allow us to reduce cost in efficient markets while we companies with annual growth expectations of 30-50%. Fees arefocus on the skill set in active strategies,” Marra explained. 1.5% and 20%. The fund was up 20% for 2007 and has a 28% Despite the growth rally from mid-May onwards, the cycle is annualized rate of return over three years.still in its beginning stages, said Janet Bunch, executive v.p. andinvestment counselor at Montag & Caldwell InvestmentCounsel in Atlanta. After a seven-year value run-up, growth Peoplestocks are so cheap that the growth cycle could be prolonged. Ina slowing economy, large-cap companies with consistent earnings Apollo Snags Rainmaker For Capitalgrowth are better placed to maintain their profitability. George Markets PushNorthrop, v.p.-marketing at Montag & Caldwell, has seen Apollo Management has hired Robertreallocations from existing clients and positive flows into the Burdick, chief marketing officer at Pequotfirm’s mutual funds, but there hasn’t been a lot of RFP activity. Capital Management in New York, toAndrew Eras, director of institutional marketing at Stralem & spearhead an aggressive growth plan for itsCo. in New York, has seen a lot of interest from prospects so far capital markets division. Serving as co-head ofthis year, which he attributes to Stralem’s consistent returns. marketing, Burdick will work alongside Stephanie Drescher, a partner who focuses on Robert Burdick Apollo’s private equity business. They plan toRenewable Energy Manager Taps build an institutional-quality marketing and client service groupInto Rising Demand and have yet to decide how many people to hire.Sustainable Energy Investors is raising assets for its New Energy Apollo manages $10 billion in five capital markets vehicles,Fund LP. The $15 million hedge fund recently secured including some hedge funds, and intends to launch additionalcommitments totaling $20 million from two funds of funds, strategies. Its current offerings—Apollo Strategic Value Fund, APwhich should be finalized this month. Partner Abigael Laufer Investment Europe, Apollo Investment Corporation, Apollo Asiahopes to raise $500 million to $1 billion in the next three to five Opportunity Fund and Apollo European Principal Finance Fund—years. She said interest from U.S. investors is increasing as focus on debt and equity in the public and private markets.demand for renewable energy rises. “The close collaboration among the firm’s investment teams is An offshore fund was also launched in September and Laufer truly impressive,” said Burdick, adding that Apollo has ais seeing enormous interest from Europe in solar energy and fantastic reputation. The firm has $40 billion in total assetsother sectors. Laufer and Founder Marx Cox will be traveling to under management.conferences and road shows in Europe and the U.S. to pitch their Burdick and his team raised more than $3 billion in8 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  9. 9. January 28, 2008 www.moneymanagementletter.com Money Management Letterinstitutional assets for Pequot, which he joined in January 2005. Consultants Leave CallanHe hired 12 client-facing marketers and client service Brian Zeiler and Aaron Roberts, consultantsprofessionals, eight of who remain with the firm. Frances Selby, at Callan Associates, have left the firm forhead of client service, will replace him. unrelated reasons. Zeiler, a v.p. and fund Pequot has experienced mixed fortunes over the past couple sponsor consultant in Atlanta, is joiningof years, during which it has faced a Securities and ExchangeCommission investigation into insider trading charges against Franklin Templeton Institutional’s FortCEO John Mack and Morgan Stanley. No wrongdoing was Lauderdale, Fla., sales team. He will focus onfound. Last year, the $7.4 billion firm closed three funds with Brian Zeiler East Coast foundations & endowments. He$500 million in total assets—two had performed poorly and left on Jan. 9, having spent seven years withthe third failed to attract sufficient investor interest. Callan, both as a general consultant and an international equityMeanwhile, Art Samberg’s flagship Pequot Core Global Fund manager research specialist. His clients have been notified andreturned 35.1% last year and the small-cap Pequot Scout Fund are being transitioned to other consultants, said Nancywas up 18.4%. Malinowski, spokeswoman. Throughout his career, Burdick and marketing teams he has Roberts is moving to Artisan Partners in New York whereled have raised $30 billion. He has worked for MacKay Shields, he will be reunited with former colleague Eric Colson. TheyLoomis, Sayles & Co. and Travelers Asset Management both belonged to Callan’s Institutional Consulting Group,Pension Services. which works with money managers. Roberts left Callan’s Florham Park, N.J., office on Dec. 31 and Colson departed back in 2005.Philadelphia HiresInvestment Officer Domestic Bond Team Leaves SSgARhonda McNavish has joined the $5.2 billion Philadelphia Mike Wands, head of fixed income for North America at StatePublic Employees Retirement System as an investment officer Street Global Advisors, has left the firm along with threefor public equities and fixed income. She replaces Brian Glanz, portfolio managers. Marie McGehee, spokeswoman, declined towho left the fund last year to join hedge fund of funds New comment on why they left. Wands could not be reached.Market Capital. McNavish was previously a senior research As part of a management shake-up late last year, Mark Marinellaanalyst at ADVISORport, a provider of managed account was named global cio for fixed income. Paul Greff, director oftechnology and operational services to money managers and global fixed income, and Michael O’Hara, head of active globalother financial firms. McNavish has also worked as a credit fixed income, left SSgA. Marinella is planning to enhance his teamanalyst at Deutsche Asset Management, said in research, portfolio strategy and risk management, McGehee said.CIO Chris McDonough. This might involve hiring professionals as the need arises, she Separately, the fund will issue an RFP for added. Marinella did not return a call.global bond managers this month or earlyFebruary to boost returns in fixed incomeand better reflect market opportunities. The NOW GET money management letterfund invests 24% in bonds with Aberdeen ON FRIDAY! Chris McDonoughAsset Management and Pyramis Global Paid subscribers now have access to a PDF of the upcomingAdvisors for core-plus, Western Asset Management for core- Monday’s newsletter on MML’s Web site Friday afternoonplus and global inflation-linked bonds, Lord Abbett for before 5 p.m. EDT. That’s a 64 hourconvertible bonds and Rhumbline Advisers for a passive jump on mail delivery, even whenLehman Brothers Aggregate mandate. Philadelphia might the post office is on time! Readswitch some incumbent managers to global mandates, but will the news online at your desk oralso consider new firms (MML, 10/18). print out a copy to read at Additionally, the board will select a general consultant on Jan. your leisure over the31. The finalists are R.V. Kuhns & Associates, Yanni Partners weekend. Either way, you’ll beand incumbent Fiduciary Investment Solutions. Emerging getting our breaking news evenmarket equity finalists will also be chosen at this meeting, sooner and starting your week offMcDonough said. fully informed! To receive email alerts or online access, call 800-715-9195. 9
  10. 10. Money Management Letter www.moneymanagementletter.com January 28, 2008 normally too small to have their own marketing staff, so partnering with placement agents or getting suggestions from PLAN SPONSOR other limited partners makes sense. His incumbent managers often introduce Collett to their other pension fund clients, who PROFILE put him in touch with successful managers. Collett doesn’t like to use the term “hedge funds” and prefers “absolute return,” as he seeks strategies that offer little to no beta.Brian Collett “Some hedge funds have as much as 30-40% beta exposure andCIO, Missouri Local Government Employees that’s what I’m trying to diversify away from,” he said. Collett hasRetirement System converted some of his incumbent bond managers to absolute return strategies and will seek to invest in absolute return equity inBrian Collett takes a defensive approach to portfolio the coming years. The change will likely be implemented throughmanagement. “My job is to build a house that can withstand any incumbent equity managers that offer hedge fund-like strategies.type of weather. I don’t forecast the weather,” he said. He focuseson diversifying the portfolio so it can hold its own through all On Partnering With Managersmarket environments in the long-term. Collett makes his managers work for their fees, using them like When Collett joined the $4 billion fund in 2005, the an investment staff. He often leans on Bridgewater Associates,portfolio was beating its target 7.5% rate of return. He wanted to Brandywine Global Investment Management, Barclays Globalmake sure that performance remained consistent by reducing Investors, PIMCO and Aronson+Johnson+Ortiz for investmentrisk, and he sought to diversify the plan as much as possible. analysis and advice. PIMCO manages absolute return fixed-Collett has convinced the board to invest in a range of alternative income and commodities, and Collett often goes to the managerstrategies including absolute return, portable alpha, 130/30, for fixed-income expertise. He views AJO as a sophisticatedcommodities, real estate, private equity and infrastructure. At the trading manager. “I go to them with every trade relatedbeginning of 2007, the system set a 10% combined target question,” he said. Depending on the managers’ skill set, Collettallocation to private equity and real estate and has been making will give them analysis work. For example, if he is doingcommitments ever since—seeking managers that have the least capitalization analysis on the whole portfolio or on a specificcorrelation to public markets. manager, he will give another incumbent all the holdings and returns, while removing manager names, and have them evaluateOn Alternatives the portfolio. “It’s the same type of work that I would give anThe fund has already made commitments to private equity funds analyst that was working here,” he said.with TCW and Brentwood Associates and has invested in an Collett often has so much conviction in his incumbentinfrastructure fund with Global Infrastructure Partners as part managers that he will be the first investor in their new offerings.of its real estate allocation. Going forward, Collett is seeking Large-cap value firm Systematic Financial Management recentlyfunds that will be better diversifiers, focusing on opportunistic launched an international equity strategy that the fund investedreal estate, more infrastructure, mid-market to small buyout in. LAGERS was also the first external client in Brandywine’sfunds and mezzanine debt. Large buyouts and venture capital 130/30 strategy. PIMCO, meanwhile, secured a commitmentmanagers tend to rely on initial public offerings as an exit from the plan in its Distressed Mortgage Fund. Other distressedstrategy, making them more correlated to Missouri LAGERS’ funds have approached Collett, but he and his board had moretraditional investments. “Opportunistic real estate tends to be confidence in PIMCO. “They are a very good bond managerless general economy oriented and more local economy and an excellent analyzer of credit,” Collett said.oriented,” he added. It also provides more of a short-term focus,while infrastructure is longer-term. Personal Notes As Collett operates with a minimal investment staff and Prior to joining Missouri LAGERS, Collett was a senior researchwithout a consultant, he has been forming strategic alliances manager at the South Carolina Retirement System. He beganwith placement agents. He came across TCW’s fund through his investment career at Russell Investment Group as a senioran alliance with Credit Suisse. “It’s about finding good technology analyst. Collett is a CFA charter holder and obtainedtrustworthy individuals, forming a strategic line-up and telling his MBA from Butler University in Indiana. He lives in Jeffersonthem what I’m looking for,” he said. Collett has about 12 City, Mo., with his wife of 15 years, Michelle, and two children,relationships with placement agents to filter through private Andrew and Zoe. He is an avid runner and hopes to find time toequity managers. The types of general partners he seeks are participate in a marathon in 2008.10 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  11. 11. January 28, 2008 www.moneymanagementletter.com Money Management LetterASK THE ADVISORInvestment Subsidiaries Should Distance Selves From ParentsEvery issue, MML poses reader questions to consultants. Is there something you’re dying to ask? Let us know by contacting EmmaBlackwell, managing editor, at 212 224 3279 or eblackwell@iinews.com.Will the asset management divisions of large investment Peter Roney, Director of Manager Research, Cambridgebanks suffer as a result of their parent companies’ Associates: It depends on what is going on in therecent subprime troubles? organization. Some have handled it better than others— focused very clearly on maintaining trust and integrity with David Thomas, ceo, Equitas Capital clients and some have even compensated clients—and that Advisors: There is almost no way it can not has a very pronounced effect. With subprime it is very have an impact on the asset management apparent that most of the problems are in active fixed-income divisions. A corporation works like an so the effect on other investment teams should be negligible. organism: if it’s bleeding in one area the If clients smell contagion it could become a problem. A loss whole body will send what is needed to that of confidence in how the overall organization is run can cause area. The corporation will do what it thinks it staff to leave to protect their reputation. If the hit has enough David Thomas impact it can cause the reduction of bonuses and incentives needs to, to survive. Corporate managers andceos will move things around. During the bear market from across all teams.2000 to 2002 a number of asset management divisions were The business of investing is about diversification andstruggling and you saw the parent companies raid other divisions managing risk. The failure of risk management could lead to ato support them. It could just as easily happen in reverse. The general withdrawal of assets. One of the things we look for inworst thing they can do is to raid an asset management division an organization is the humility to realize that there is no suchthat is doing fine on its own to shore up losses. The division will thing as certainty. No one could have been expected tohemorrhage talent if they do, because if portfolio managers have anticipate the current problems in subprime. Certainly thebeen hitting their marks they’ve earned their bonuses. Those guys ratings agencies didn’t. There is a book called The Black Swan:know what they’re worth. The Impact of the Highly Improbable by Nassim Nicholas Taleb The best way for management to minimize the impact with about these big improbable events which no one predicts. It’s aclients is to make it clear that the investment management arm bit of a hard read, but it does a good job of illustrating thatis a separate entity. Connection with banks that were hit by these events happen far more often than we think they do, orsubprime could have an effect on a search. Just the possibility could. Risk management is based on statistics and events likeof that kind of distraction could cause a manager to lose a subprime are often so improbable that no model can pickpossible mandate. When you get down to the finals you’re them up. I think that all the examples we have seen of seriousprobably comparing the best money managers out there. In the losses is with organizations which lost sight of that. They wereend you’re splitting hairs, looking for any reason to bring it making unusual bets; high concentration and a lot of leverage.down to the one you’re going to entrust with those assets. It Unfortunately, the market has a nasty habit of disabusing us ofdoesn’t take much. our certainties. iisearches posted $220 billion in alternative search leads in 2006...The worlds number one sales and marketing tool for investment managers ...grow your business with the latest daily search leads.For further information on iisearches’ daily search leads and searchable database of search-and-hire activity since 1995, visit www.iisearches.com or contact Keith Arends in New York at 212-224-3533 or at karends@iinews.com, or Ben Grandy (Europe and rest of the world) Tel: +44 (0)20-7779-8965 or at bgrandy@iinews.com
  12. 12. Money Management Letter www.moneymanagementletter.com January 28, 2008News RecapThe News Recap is a summary of publicly reported news briefs. The information has been obtained from sources believed to be reliable, butMML does not guarantee its completeness or accuracy.Funds • Verizon Investment Management is seeking a director to• The $115 billion Teacher Retirement System of Texas is handle its absolute return investments within its definedtalking to six finalists about becoming “strategic partners,” benefit plans.including BlackRock. Successful managers will each receive$1 billion or more to invest across the globe. They will be • Hillcrest Asset Management has hired Douglas Stark asexpected to share knowledge and tactics, and give the fund access managing director for portfolio management and research.to investment deals. Stark was a senior v.p. and director of research at Martingale Asset Management.• The Ohio School Employees Retirement System is seeking aglobal real estate investment trust manager to oversee up to Firms$250 million. Additionally, the plan hired six hedge fundmanagers: Och-Ziff Management, Marathon Asset • Denver-based Red Rocks Capital and ALPS Fund Services have launched an actively-managed mutual fund that invests inManagement, Diamondback Capital Management, Endeavor the stock of publicly-traded private equity firms.Capital, Farallon Capital and Taconic Capital Advisors. • Paradigm Asset Management has launched a high-capacity• Most U.S. institutional investors posted modest returns last small-cap core strategy designed to offer greater active exposureyear, according to Northern Trust. Corporate and public funds to a variety of small-cap stocks.returned 8.4% and 8.5%, respectively, while foundations andendowments gained 9.4%. • Dubai Holding has acquired 38.14 million class A shares of hedge fund firm Och-Ziff Capital Management Group, a• The Louisiana State Police Retirement System selected 51.4% stake.Hancock Timber Resource Group and The Campbell Group tomanage $5 million each in timber. • Consulting firm Laven Partners plans to launch a “best ideas” fund that will invest with boutique hedge fund• The Montana Board of Investments will issue an RFP at the managers. Likely dubbed Laven Funds Multi-Strategyend of January for at least one non-core fixed-income manager. Fund, the portfolio will launch March 1 and will invest inCurrently, all its as all fixed-income assets are managed in-house, about 10 funds.in core strategies. • Martin Asset Management plans to launch its IliosPeople Alternative Energy Fund. The long-biased fund will invest in companies tied to wind, solar, hydro, geothermal and•Hudson Bay Capital hired Amaranth Advisors’ Chief biomass energy.Operating Officer Charles Winkler to fill a similar position. • Bear Stearns is in• New England Pension Consultants hired Edward O’Donnell Management. Chinatalks to acquire a 10% stake in China has AssetIII and Jeffrey Mitchell as consultants. O’Donnell was an AM, a subsidiary of Citic Securities,assistant v.p. and portfolio specialist at Wellington Management also held talks with T. Rowe Price Group.Co. Mitchell was a senior investment consultant at Pillar • Credit Suisse and General Electric are teaming up to launch aFinancial Advisors. $1 billion Middle Eastern infrastructure fund with Abu Dhabi- based investment firm Mubadala.• Daniel Cardell has joined Wayne Hummer AssetManagement as president and cio. He was teaching finance at • BlackRock’s fourth-quarter earnings surged 90%, thanksthe University of Illinois at Chicago and previously served as largely to acquisitions and performance fees. Acquisitionsdirector of equities at Weiss, Peck & Greer and Bank of America including Merrill Lynch’s investment unit and Quellos Group’sin Chicago. Todd Doersch, founder of hedge fund Cognitive hedge fund unit helped the firm double its assets to $1.4 trillion.Investment Management, has also joined Wayne Hummer as Performance fee income more than tripled to $153 million fromhead of product management. $40 million.• State Street Corp. has promoted David Gutschenritter to • UBS launched the UBS Greenhouse Index, which allows markettreasurer from executive v.p. players to gauge their exposure to greenhouse gas emissions.12 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.
  13. 13. January 28, 2008 www.moneymanagementletter.com Money Management LetterSearch & Hire DirectoryThe following directory includes search and hire activity from iisearches for the two weeks ending Wednesday, Jan. 23. The accuracy of theinformation, which is derived from many sources, is deemed reliable but cannot be guaranteed. All amounts are in US$ millions unlessotherwise stated. To report manager hires and new searches, please call Emma Blackwell at (212) 224-3279.Potential Searches Total AccountFund & City Amount Plan Type Assignment Size Consultant Comments/Firm HiredArmstrong World Industries, USD2,500 Corporate D.B. Unknown / Active USD2,300 Russell Investment Plans to adopt liability-driven investments this year.Lancaster, PA Fixed-Income Group, New York, NYAurora City General Employees USD306 Public D.B. International / N/A Callan Associates, Will place State Street Global Advisors on watch for personnelRetirement System, Aurora, CO Active Equity San Francisco, CA changes.Cranston Print Works Co., USD89.60 Corporate D.B. Global / Asset Study USD89.60 State Street Global Will conduct a triennial asset allocation study by June.Cranston, RI Advisors, Boston, MACranston Print Works Co., USD89.60 Corporate D.B. US / Active Fixed-Income N/A State Street Global Analyzing liability-driven investment strategies with plans toCranston, RI Advisors, Boston, MA eventually add the asset class to its portfolio.Hercules Incorporated, USD2,035 Corporate D.B. US / Active Fixed-Income N/A Russell Investment Group, Increasing its fixed-income exposure to 80%.Wilmington, DE New York, NYIngram Industries, Nashville, TN USD187 Corporate D.B. Global / Asset Study USD200 Unknown Will do an asset allocation study next month.Maryland State Retirement & USD39,800 Public D.B. US / Alternative (All) / N/A Ennis Knupp + Associates, May seek commodities managers after increasing the allocation toPension System, Baltimore, MD Commodities Chicago, IL 5% from 2%, following an asset study.Maryland State Retirement & USD39,800 Public D.B. Global / Active Equity N/A Ennis Knupp + Associates, Increased its allocation to 15% from 10% and may seek managersPension System, Baltimore, MD Chicago, IL later this year.Metropolitan Water Reclamation USD1,100 Public D.B. International / N/A Standard Valuations, Studying international equity and may make allocations to the assetDistrict Retirement Fund, Chicago, IL Active Equity St. Paul, MN class this year.Metropolitan Water Reclamation USD1,100 Public D.B. US / Alternative N/A Standard Valuations, Researching hedge funds. May make allocations this year.District Retirement Fund, Chicago, IL Hedge Funds St. Paul, MNMetropolitan Water Reclamation USD1,100 Public D.B. US / Real Estate N/A Unknown Trustees are learning about real estate and may make allocationsDistrict Retirement Fund, Chicago, IL this year.Missouri Department of USD1,800 Public D.B. International / Real Estate N/A Summit Strategies Group, Planning a maiden foray into international real estate.Transportation & Patrol Employees St. Louis, MORetirement System, Jefferson City, MOMissouri Public School Retirement USD25,700 Public D.B. US / Passive Equity N/A Unknown Planning changes to its domestic large-cap equity program,System, Jefferson City, MO including shifting some money to passive from active management, terminating several managers and seeking alpha sources.Montana Board of Investments, USD8,000 Public D.B. US / Active Fixed-Income / N/A R.V. Kuhns & Associates, Will discuss issuing an RFP for non-core fixed-income managers atHelena, MT High-Yield Portland, OR its February board meeting.New Mexico State Investment USD16,500 Endowment US / Real Estate N/A Unknown Looking to increase its real estate exposure to 3% from 2.5%.Council, Santa Fe, NMNew Mexico State Investment USD16,500 Endowment US / Alternative N/A Unknown May seek additional hedge fund managers as part of its strategy toCouncil, Santa Fe, NM Hedge Funds agressively round out its alternatives allocation. There is no time frame for a decision.Norfolk Employees’ Retirement USD900 Public D.B. US / Alternative N/A Summit Strategies Group, Considering initial private equity investments this year. Not talkingSystem, Norfolk, VA Private Equity St. Louis, MO calls from managers.Norfolk Employees’ Retirement USD900 Public D.B. US / Alternative N/A Summit Strategies Group, May consider initial hedge fund investments this year. Would preferSystem, Norfolk, VA Hedge Funds St. Louis, MO not to receive manager solicitations at this time.Oklahoma Police Pension & USD1,800 Public D.B. US / Active Equity / N/A Asset Consulting Group, Will review performance of its enhanced large-cap mandate run byRetirement System, Oklahoma City, OK Large-Cap St. Louis, MO State Street Global Advisors at its next meeting. It may recommend termination and possible issuance of an RFP to replace the firm.New SearchesArkansas Teachers Retirement USD12,000 Public D.B. US / Alternative N/A Ennis Knupp + Associates, Carved out a 5-6% allocation to inflation-protected strategiesSystem, Little Rock, AR Chicago, IL including timber, commodities, infrastructure and TIPS.Arkansas Teachers Retirement USD12,000 Public D.B. US / Active Equity USD300 Ennis Knupp + Associates, Will conduct an invitation-only search and issue RFPs to a group ofSystem, Little Rock, AR Chicago, IL activist managers.Fort Worth (Texas) Employees USD1,800 Public D.B. US / Consultant N/A None Issued an RFP for a hedge fund consultant. Proposals are due by Feb. 1.Retirement Fund, Fort Worth, TX To receive email alerts or online access, call 800-715-9195. 13
  14. 14. January 28, 2008 www.moneymanagementletter.com Money Management LetterNew Searches (cont’d) Total AccountFund & City Amount Plan Type Assignment Size Consultant Comments/Firm HiredInternational Paper Co., USD8,500 Corporate D.B. US / Alternative (All) / N/A Rocaton Investment Seeking managers of derivatives-based strategies. Plans to makeStamford, CT Commodities Advisors, Norwalk, CT selections during the first quarter. Interested firms should contact Rocaton Investment Adivsors.International Paper Co., USD8,500 Corporate D.B. US / Alternative (All) N/A Rocaton Investment Seeking commodities managers. Plans to make selections during theStamford, CT Advisors, Norwalk, CT first quarter. Interested firms should contact Rocaton Investment Adivsors.International Paper Co., USD8,500 Corporate D.B. Global / Passive N/A Rocaton Investment Seeking managers to implement new allocations to TreasuryStamford, CT Fixed-Income / Advisors, Norwalk, CT inflation-protected securities. Plans to make selections during the Inflation-Linked Bonds first quarter of this year. Interested firms should contact Rocaton Investment Adivsors.Massachusetts Pension Reserves USD54,200 Public D.B. EAFE / Passive Equity USD1,500 Unknown Looking for passive EAFE equity managers.Investment Management Board,Boston, MANew Jersey Division of USD81,800 Public D.B. US / Active Equity / USD2,000 Strategic Investment Will issue an RFQ for managers to handle USD2 billion in small-capInvestment, Trenton, NJ Small-Cap Solutions, San Francisco, CA later this month.New Jersey Division of USD81,800 Public D.B. International / USD3,000 Strategic Investment Will issue an RFQ in March for managers to handle USD3 billion inInvestment, Trenton, NJ Active Equity Solutions, San Francisco, CA March.New Jersey Division of USD81,800 Public D.B. US / Alternative USD2,000 Cliffwater, LLC, Will invest USD1.7 billion in hedge funds and USD250 million inInvestment, Trenton, NJ Hedge Funds Santa Monica, CA fund-of-funds by June 2008. It will focus on emerging manager and activist fund-of-funds.North Attleboro (MA) Retirement USD60 Public D.B. International / N/A Dahab Associates, Will issue an RFP for an international equity manager by month’s end.System, North Attleboro, MA Active Equity Franklin, MAOhio Police & Fire Pension USD12,900 Public D.B. US / Alternative Hedge USD400 Wilshire Associates, Requesting proposals from qualified firms interested in providingFund, Columbus, OH Funds / Market-Neutral Pittsburgh, PA active market-neutral alpha overlay investment management Hedge Fund services. Proposals are due Feb. 8.Orange County Employees USD8,000 Public D.B. US / Real Estate / Core USD46 Callan Associates, Seeking two commingled fund managers for its core real estateRetirement System, Santa Ana, CA San Francisco, CA program.School Employees Retirement USD11,690 Public D.B. Global / Real Estate / USD250 Unknown Searching for a global REIT manager to run up to USD250 million.System of Ohio, Columbus, OH REIT The RFP will be issued in the next few weeks.Workers Compensation Board CAD2,800 Permanent Fund Global / Active Equity / N/A Brockhouse & Cooper, Actively seeking 130/30 equity managers.of Alberta, Edmonton, ALB 130/30 Montreal, QEUpdated SearchesAdams County Retirement USD206 Public D.B. US / Active Equity / N/A Watershed Terminated RS Investments from a domestic small-cap growthPlan, Brighton, CO Small-Cap Growth Investment Consultants, equity mandate. Highlands Ranch, COAdams County Retirement USD206 Public D.B. US / Active N/A Watershed Terminated Janus Capital Corporation for domestic active fixed-Plan, Brighton, CO Fixed-Income Investment Consultants, income for unspecified reasons. Highlands Ranch, COEl Paso County Retirement USD275 Public D.B. US / Active Fixed- USD13 Watershed Terminated Western Asset Management Co. because it wasn’tSystem, Colorado Springs, CO Income / Absolute Return Investment Consultants, providing sufficient diversification. WAMCO’s assets were Highlands Ranch, CO reallocated to incumbents.Indiana Public Employees’ USD16,100 Public D.B. Global / Active Equity / USD413 Mercer , New York, NY Terminating Brandes Investment Partners.Retirement Fund, Indianapolis, IN Micro-Cap GrowthKentucky Retirement Systems, USD17,000 Public D.B. US / Consultant N/A Strategic Investment Issued an RFI for a real estate investment consultant. ResponsesFrankfort, KY Solutions, San Francisco, CA were due by Jan. 23.Massachusetts Pension USD54,200 Public D.B. US / Active Equity USD1,500 Unknown Terminated Boston Company Asset Management and State StreetReserves Investment Management Global Advisors due to personnel issues.Board, Boston, MANew Mexico Public USD13,400 Public D.B. Asia / Alternative Private USD30 Unknown Investment committee is expected to recommend at its Jan. 31,Employees Retirement Equity / Buyout 2008 board meeting that the fund commit USD30 million to TPG Asia V.Association, Santa Fe, NMTeacher Retirement System USD115,000 Public D.B. Global / Active USD6,000 Unknown Plans to hire four to six of the best global money managers to investof Texas, Austin, TX Fixed-Income USD1 billion or more each in fixed-income across the globe. Identified six finalists including BlackRock.Completed SearchesAustin (Texas) Police USD515 Public D.B. Global / Multi Asset USD15 Consulting Services Group, Thornburg Investment ManagementRetirement Fund, Austin, TX Memphis, TNCity of Naples (Fla.), Naples, FL USD85 Public D.B. US / Active Equity / N/A Citigroup, NY Rothschild Asset Management Large-Cap Value To receive email alerts or online access, call 800-715-9195. 15
  15. 15. Money Management Letter www.moneymanagementletter.com January 28, 2008Completed Searches (cont’d) Total AccountFund & City Amount Plan Type Assignment Size Consultant Comments/Firm HiredConnecticut Retirement Plans & USD26,000 Public D.B. US / Real Estate / Core USD75 Unknown Cornerstone Real Estate AdvisersTrust Funds, Hartford, CTEl Paso County Retirement USD275 Public D.B. US / Active Equity / USD20 Watershed Eaton Vance ManagementSystem, Colorado Springs, CO Large-Cap Investment Consultants, Highlands Ranch, COIowa Municipal Fire & Police USD1,500 Public D.B. US / Active Equity / USD40 Summit Strategies Group, Quantitative Management AssociatesRetirement System, Des Moines, IA Large-Cap St. Louis, MOIowa Municipal Fire & Police USD1,500 Public D.B. US / Active Equity / USD60 Summit Strategies Group, State Street Global AdvisorsRetirement System, Des Moines, IA Large-Cap St. Louis, MOIowa Municipal Fire & Police USD1,500 Public D.B. US / Active Equity / USD60 Summit Strategies Group, INTECHRetirement System, Des Moines, IA Large-Cap St. Louis, MOIowa Municipal Fire & Police USD1,500 Public D.B. US / Active Equity / USD40 Summit Strategies Group, JPMorgan Investment ManagementRetirement System, Des Moines, IA Large-Cap St. Louis, MOIowa Municipal Fire & Police USD1,500 Public D.B. US / Active Fixed- USD55 Summit Strategies Group, Aberdeen Asset ManagementRetirement System, Des Moines, IA Income / Core St. Louis, MOLehigh County (PA) Employees’ USD360 Public D.B. International / USD22 Unknown Julius Baer Investment ManagementRetirement Fund, Allentown, PA Active EquityLos Angeles City Employees USD10,400 Public D.B. US / Active Equity USD22.60 Pension Consulting Sparx Asset ManagementRetirement System (LACERS), Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Active Equity USD73.80 Pension Consulting Knight Vinke Asset ManagementRetirement System (LACERS), Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Active Equity USD125 Pension Consulting Relational InvestorsRetirement System (LACERS), Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Active Equity USD58.70 Pension Consulting Hermes Pensions ManagementRetirement System (LACERS), Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Active Equity / USD50 Pension Consulting BLUM Capital PartnersRetirement System (LACERS), Small- to Mid-Cap Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. West Europe / USD35 Pension Consulting Governance for Owners GroupRetirement System (LACERS), Active Equity Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. UK / Active Equity USD35 Pension Consulting Principle Profits Asset ManagementRetirement System (LACERS), Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Alternative Private USD25 Hamilton Lane Advisors, Vista Equity PartnersRetirement System (LACERS), Equity / Buyout Philadelphia, PALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Alternative USD10 Pension Consulting Spire Capital PartnersRetirement System (LACERS), Private Equity / LBO Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Alternative USD5 Pension Consulting Relativity FundRetirement System (LACERS), Private Equity / LBO Alliance, Encino, CALos Angeles, CALos Angeles City Employees USD10,400 Public D.B. US / Active Equity / USD50 Pension Consulting New Mountain CapitalRetirement System (LACERS), Large-Cap Alliance, Encino, CALos Angeles, CALouisiana State Police Retirement USD460 Public D.B. US / Alternative / USD5 PRIME Asset Consulting, Hancock Timber Resource GroupSystem, Baton Rouge, LA Timberland/Vineyards Weehawken, NJLouisiana State Police Retirement USD460 Public D.B. US / Alternative / USD5 PRIME Asset Consulting, The Campbell GroupSystem, Baton Rouge, LA Timberland/Vineyards Weehawken, NJMassachusetts Pension USD54,200 Public D.B. Global / Active Equity USD2,750 Cliffwater, LLC, Marathon Asset ManagementReserves Investment Santa Monica, CAManagement Board, Boston, MANebraska Investment USD10,800 Public D.B. US / Alternative Hedge USD100 Ennis Knupp + Associates, PIMCOCouncil, Lincoln, NE Funds / Distressed Debt Chicago, ILNebraska Investment USD10,800 Public D.B. US / Alternative USD25 Ennis Knupp + Associates, Resolute FundCouncil, Lincoln, NE Private Equity Chicago, IL16 ©Institutional Investor News 2008. Reproduction requires publisher’s prior permission.