Pension Funds Are Pulling $325 Billion From Stocks
Some turn to bonds or private markets after major indexes’ run to records
Stock portfolios at large [pension funds] had a blockbuster run. Now, managers are cashing out.
Corporate pension funds are shifting money [into bonds]. State and local government funds are swapping stocks for alternative investments. The nation’s largest public pension, the California Public Employees’ Retirement System, is planning to move close to $25 billion out of equities and into private equity and private debt.
Stock portfolios at large [pension funds] had a blockbuster run. Now, managers are cashing out.
What is the pension fund manager’s goal? If the goal is to provide, say, 7% growth a year then having reached that goal already for the year it makes sense to move to a more conservative position.