US - The nation's two largest pension funds have launched an emerging managers database in a bid to boost investment returns long-term.
The California State Teachers’ Retirement System (CalSTRS) and the California Public Employees’ Retirement System (CalPERS) - whose combined assets exceed US$380bn - unveiled a database of 721 Emerging Managers and Financial Service Providers (EMFSP).
The funds explained the aim was to "expose public and private pension funds and other institutional investors to a new universe of emerging investment firms in an effort to boost investment returns by building investment portfolios that tap into the changing demographics and talent emerging in California and the nation".
The EMFSP database was also sent to leaders and top investment officers of the nation’s pension funds and posted it on their websites.
Altura Capital developed the directory, which covers emerging and under-capitalised managers, funds, partnerships, consultants, researchers, and broker-dealers in 11 asset classes. One-third of the participants are money managers, followed by hedge funds (28.4%), private equity funds (13.6%) and broker-dealers (8.9%).
The EMFSP database captures the universe of emerging financial service firms, creates an industry reference guide, promotes information transparency and broadens opportunities for adding value to institutional investors’ portfolios from a largely untapped pool of talent.
“It’s said at the ballpark that you can’t tell the players without a programme, and this database does that for us," explained CalSTRS CIO Christopher Ailman.
"This tool helps us to scout promising talent to nurture for potentially solid investment payoffs as the managers and funds mature.”
CalPERS CIO Russell Read added it was easy to miss emerging firms that were still struggling to raise capital. “Most large firms started at the small end of the market and we want to find them on the small end of their asset class," explained Read. "Then we won’t have to stand in line for their services on the big end later.”
Jonathan Stapleton asks whether newly-accredited professional trustees should be a statutory fixture on pension scheme boards.
Savers are being warned by the Insolvency Service to guard their pension pots from investment scammers and negligent trustees as it winds up 24 companies.
Respondents say they should only be required in certain situations as the system is not broken.