The Profile: Ash Williams, Executive Director and CIO of the Florida State Board of Administration, speaks about public pensions and strategic partnerships—and why every asset manager wants them.
“It is a misperception that new benefit structures raise costs in the short run because of a Government Accounting Standards Board (GASB) accounting rule that accelerates amortization schedules,” says Dr. Robert M. Costrell, Professor of Education Reform and Economics at the University of Arkansas.
The root of the problem for portfolios today among US investors, from individual retirement accounts to institutional pensions, is home market bias, according to PIMCO.
Explicit risk policies, performance measurement, and liability accounting must all be part of strong governance structures at public pensions, according to the National Conference of Public Employees Retirement Systems.
While hedge funds have a potentially valuable role in reducing overall portfolio risk due to their low correlation with other assets, their overall superior risk and return characteristics are questionable, according to a newly published paper.
If investors combine various asset classes, they can create a portfolio that is similar to a global market-cap portfolio, cutting volatility and increasing their Sharpe ratio, says Antti Ilmanen, managing director of AQR Capital Management.
The second largest public pension fund in the United States has sued officers and directors of Wal-Mart over allegations that the retailer bribed officials in Mexico.
Many investors remain underexposed to international small cap stocks -- an underweight that could be increasingly costly, according to a whitepaper by Morgan Stanley Investment Management.
