“Brenna began her career at Public Schools Retirement System/Public Education Employee Retirement System in 2020. We were fortunate to recruit Brenna to the investment team after an eight-year tenure at Goldman Sachs because she wanted to relocate to her home state of Missouri.
“Brenna manages two composites for the systems: a $2 billion alpha overlay portfolio that represented 3.4% of total fund assets as of December 31, 2024, and a $4.7 billion stand-alone hedged asset portfolio that represented 7.9% of total fund assets as of December 31, 2024.
“The alpha overlay composite returned a net 13.7% for the five-year period that ended December 31, 2024, providing great diversification to a large U.S. equity portfolio. The hedged asset composite returned a net 5.9% for the same period versus an internal benchmark of 5.4%. The hedged asset composite targets a net of 0.30. For the five-year period that ended December 31, 2024, the PSRS/PEERS hedged asset program outperformed the HFRI Asset Weighted Composite Hedge Fund Index by 133 basis points (5.89% net return for PSRS/PEERS vs. 4.56% return for HFRI AWC). Over the same five-year period, the PSRS/PPEERS program outperformed the return of the HFRI Fund-of-Funds Composite Index by 66 basis points (5.89% net return for PSRS/PEERS vs. 5.23% for HFRI FOF). The hedged asset composite offers tremendous diversification to the overall systems portfolio that is heavy beta dependent.
“Brenna has made a direct impact on the hedged asset and alpha overlay portfolios through outstanding manager selection, skillful portfolio construction, the ability to introduce new concepts and the acceptance of tracking error.
“Brenna has also been actively involved in recruiting investment professionals to PSRS/PEERS and, more importantly, mentoring them throughout their careers. Specifically, Brenna has been active in recruitment efforts at the University of Missouri, including the investment internship program at PSRS/PEERS. Brenna is a frequent speaker in finance classes at the University of Missouri.”
—Craig Husting, CIO, Public School and Education Employee Retirement Systems of Missouri
The CHIEF INVESTMENT OFFICER Editorial Team shared a dozen questions with all our NextGen nominees and asked them each to pick six to answer. Their answers informed our decision to include them as a NextGen. Below are Brenna Noble’s answers.
CIO: What is the best way to bring more diversity to the financial industry?
Noble: I strongly believe in the power of mentorship and representation. As a woman in a majority-male industry, I know what it has meant to me and my career to have women to look up to who are further along in their careers. It is important to reach young women early in their college years to help encourage them to pursue a career path in finance. I try to be a catalyst for this by engaging with students at my alma mater, the University of Missouri.
CIO: What asset classes offer the best options for avoiding or mitigating drawdown risk in an institutional portfolio?
Noble: In our portfolio, our hedged assets program is intended to be a diversifying part of the portfolio to mitigate market drawdowns. We recognize that hedge funds are not an asset class in and of themselves, and we endeavor to build a portfolio of hedge funds that are not only diversifying to one another, but provide a ballast for the overall portfolio. Our portfolio consists of both relative value and directional strategies, which utilize a wide variety of asset classes and strategies to achieve returns uncorrelated to traditional markets.
CIO: How can allocators address the growing global headwinds of demographics, geopolitical tensions, trade wars and changing supply chains?
Noble: Diversification is the single best risk management tool that allocators have. By building a diversified portfolio across asset classes, investment managers and individual trades, the portfolio is less exposed to any one single source of risk. The added benefit pension funds have is the long-term time horizon. This allows us to build a diversified portfolio with high conviction ideas that we believe will add value over multiple cycles, with the ability to tolerate a prudent amount of short-term volatility.
CIO: What traditional and/or alternative asset classes do you think are most important for institutional portfolios, and why?
Noble: Private equity is an important part of institutional portfolios as a portfolio diversifier and for the higher return potential the asset class can provide. The number of private companies is significantly larger than the number of public companies, resulting in a much broader investment universe for sourcing investments. The long-term nature of a private equity investment allows sponsors and company management to focus on real value creation, rather than having a short-term focus on quarterly earnings. Additionally, private equity GPs have more tools available to them to help a company grow and become more efficient to unlock value. Private equity GPs can also use creative deal structuring that can result in additional return on their investments.
CIO: What investing decision have you made for your organization that you’re most proud of?
Noble: Decisionmaking at our organization is collaborative and is not concentrated in a single person. I’m most proud of the contributions I’ve made to the organization through manager due diligence, which has led to portfolio additions and redemptions that have proven to be valuable changes to the portfolio. Understanding the various strategies employed by hedge funds to properly diligence the universe is a challenging task, but one that is highly rewarding when done successfully.
CIO: Who in asset management (a person, not a firm) has most influenced your growth as an institutional asset manager?
Noble: Kent Clark was the CIO of the hedge fund strategies group at Goldman Sachs, where I spent the first seven years of my career. While I have worked with a lot of wonderful people in my career, Kent stands out in my mind for his generosity with his time and knowledge. Although he led a large team of people, he made the effort to get to know each of us as individuals, and he was never too busy for a teaching opportunity. I have countless examples of Kent stopping by my desk when I was working on something for him, and he would sit down and make sure I really understood what I was working on, even if my full comprehension was not necessary for me to execute on the task. He would end client or manager calls and take a few more minutes with those of us in his office to have a more in-depth discussion about anything that came up on the call. He truly set an example as a leader and a person.
