CalPERS Approves Plan to Actively Manage Some Stocks In-House.SACRAMENTO Sacramento, city, United States Sacramento (săkrəmĕn`tō), city (1990 pop. 369,365), state capital and seat of Sacramento co., central Calif. , Calif.--(BUSINESS WIRE)--Oct. 27, 1998--The California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). Public Employees' Retirement System (CalPERS CalPERS California Public Employees' Retirement System ) has approved a plan to actively manage up to $2 billion of the Fund's domestic stock investments in-house In-house In the context of general equities, keeping an activity within the firm. For example, rather than go to the marketplace and sell a security for a client to anyone, an attempt is made to find a buyer to complete the transaction with the firm. , using quantative strategies. The pension fund will continue to rely heavily on passive index management - an investment strategy that tracks or replicates the activity in the stock market. But fund officials believe the benefits of internal active management, including increased diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. , lower costs and flexible investment decisions, will add value to the fund. The use of quantative strategies will leverage CalPERS' strength in managing index funds. "This plan allows us to gain access to attractive management strategies at the leading edge of investment technology," said William D. Crist, President of CalPERS Board of Administration. "We have a talented investment staff, with the expertise and experience to broaden our exposure to quantative investment strategies that will add value to our investment portfolio." "Under the plan, CalPERS will fund several different strategies in amounts ranging from $200 million to $500 million. Each strategy will have a unique portfolio construction and trading procedure. "Active management provides an additional net for CalPERS to capture the opportunities present in today's volatile market," said Charles P. Valdes, Chair of CalPERS Investment Committee. CalPERS is the nation's largest public pension fund with assets totalling more than $134 billion. The System provides retirement and health benefits to more than 1 million state and local public employees, retirees, and their families. For more information about CalPERS, visit its Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the Web site at www.calpers.ca.gov. |
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