BOSTON Feb 5 Massachusetts' $50 billion state
pension fund gained 13.9 percent in 2012, fueled by strong
returns in global equities and private equity.
"We had a terrific year," Michael Trotsky, the fund's chief
investment officer and executive director said on Tuesday at a
public meeting. "Our investment mangers are doing a very good
job for us," he added.
The fund, one of the country's biggest public pensions,
outperformed its policy benchmark by 84 basis points.
Looking back on 2012 when stocks fared well, the fund's
investments in global equities gained 17.5 percent while private
equity investments gained 15.8 percent.
Core fixed income gained only 6.35 percent.
Massachusetts, which has roughly $5 billion invested in
hedge funds, said that the hedge fund managers it employs
gained 8.42 percent last year, beating the fund's 4.8 percent
benchmark for this asset class. The state has invested with big
name managers including Paul Singer, Alan Howard, and William
Trotsky, who took on the role of CIO last year, said he
plans to spend more time this year meeting the managers who
invest money for the fund.
The fund recently opted to pick its hedge fund managers
directly instead of paying extra fees to so-called funds of
funds for that work. The move is expected to save the pension
fund $36 million a year in fees.
In November, the fund hired Eric Nierenberg, a former money
manager and business school professor, as its senior investment
officer overseeing hedge funds and low volatility strategies.
Earlier this year, the fund hired Michael Bailey as its senior
investment officer for private equity investments.