The San Antonio Fire and Police Pension Fund, worth $1.9 billion, is now in the process of transitioning its existing portfolio into more direct investments. As part of that process the Fund has increased its already existing investment in HBK Capital Management.
At its December, 2010 meeting the pension’s investment committee took the decision to increase by $5 million its investment in HBK, which is indicated in the recently published minutes of the investment committee’s meeting. This added investment is part of the overall plan for the fund to change its existing portfolio to an equal division between single hedge fund investments and funds of hedge funds (FoHF) investments.
Currently the pension fund is looking for about 10 direct hedge fund managers. When they are chosen they will each be given the management responsibilities for about $20 million.
The search will be conducted with the assistance of Albourne Partners Consultants, who will help the Texas pension fund to narrow down a list of 40 single manager hedge funds to a more workable 15-20 to pick from. The final cut will leave a “stable of just 10 hedge funds to complement the fund’s current fund of funds”, state the minutes from the meeting of the board of trustees which met at the conclusion of 2010.
Part of the transition process includes the pension fund redeeming funds from three of its FoHF managers: Optima Fund Management, Ironwood Capital Management and Benchmark. The funds which will remain are Lazard Asset Management, Federal Street Advisors and Entrust Capital where Gregg Hymowitz serves as Managing Partner.