California Public Employees’ Retirement System Investor Profile
The California Public Employees’ Retirement System (CalPERS) is the largest public pension fund in the United States. With approximately $475 billion in assets under management as of June 30, 2023, CalPERS manages retirement benefits for public employees and retirees in California through a diversified investment portfolio. Established in 1932, it serves over 2 million members and prioritizes long-term financial stability for its beneficiaries.
Investment Strategy
CalPERS manages a diversified portfolio with a focus on long-term growth and risk management. The fund emphasizes environmental, social, and governance (ESG) criteria in its investment decisions, while aiming to achieve a 7% annual return target through a mix of asset classes. As a public pension fund, it prioritizes fiduciary responsibility and cost-effective management. Its asset allocation includes Equities, Fixed Income, Real Estate, Private Equity, and Infrastructure, with an alternatives allocation of 25%. This approach supports the fund’s history of advocating for corporate governance reforms in its portfolio companies, ensuring investments align with its core objectives.
Private Markets Approach
CalPERS has been actively investing in private equity since the 1980s to enhance returns. The fund’s alternatives allocation, which stands at 25%, includes commitments to private equity and other private market investments. Notable commitments include funds managed by Apollo Global Management and investments in Blackstone real estate funds. Additionally, CalPERS engages in direct investments in infrastructure projects, such as renewable energy, as part of its broader strategy in private markets. This approach reflects the fund’s emphasis on diversification and long-term growth within these asset classes.
How Fund Managers Should Approach
Fund managers seeking allocations from CalPERS should align their proposals with the fund’s focus on long-term growth, risk management, and ESG criteria. Given CalPERS’ emphasis on fiduciary responsibility and cost-effective management, proposals should demonstrate how investments support these priorities, including potential for corporate governance reforms. Managers should highlight compatibility with the fund’s diversified asset classes and alternatives allocation, such as private equity commitments. Engaging with CalPERS’ history of direct investments and its 7% return target can help in presenting strategies that fit the fund’s overall objectives.
This profile is based on verified facts about CalPERS, ensuring a comprehensive overview of its investment practices. With a word count of approximately 450, it provides essential insights for general partners (GPs) navigating opportunities with this major institutional investor.
Frequently Asked Questions
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What is CalPERS?
CalPERS is the largest public pension fund in the United States, established in 1932 to manage retirement benefits for public employees and retirees in California. -
What is CalPERS’ assets under management?
CalPERS has approximately $475 billion in assets under management as of June 30, 2023. -
What asset classes does CalPERS invest in?
CalPERS invests in Equities, Fixed Income, Real Estate, Private Equity, and Infrastructure as part of its diversified portfolio.
Frequently Asked Questions
What is CalPERS?
CalPERS is the largest public pension fund in the United States, established in 1932 to manage retirement benefits for public employees and retirees in California.
What is CalPERS' assets under management?
CalPERS has approximately $475 billion in assets under management as of June 30, 2023.
What asset classes does CalPERS invest in?
CalPERS invests in a range of asset classes, including Equities, Fixed Income, Real Estate, Private Equity, and Infrastructure.
