The board of trustees Teachers’ Retirement System of Texas has given a final thumbs-up a new strategic asset allocation for the $156 billion fund, as part of a process that mandates the pension’s staff to review and potentially change their strategic asset allocation every five years.

The new policy shaves 3 percentage points off of the pension’s allocation to global equity markets, dropping from 57% to 54% Sub-asset class targets sit at 18% for US equity, 13% for international developed markets, and 9% for emerging markets. They also got rid of a 4% target to directional hedge funds.

Changes in the equity allocation are intended to provide the plan with a new degree of insulation from equity risk. A stock market correction in the near future is a growing concern for investors, as the bull market hangs on beyond historical trends.

Texas Teachers also increased its allocation to alternatives. Private equity, infrastructure, natural resources and energy each saw a 1% increase in their overall targets.

Allocations to US treasuries also rose by five percentage points, from 11% to 16%. Risk parity targets increased to 8% from 5%. Cash holdings also rose to 2% from 1%.

The pension is expected to begin implementing the new allocation mix over a six month period beginning October 1.

The retirement system reported that it missed its 6 and 12-month benchmarks  (3.4% and 6.7%), with returns of 3.2% and 6.4% respectively..

“Global equities continued to rally off a strong first quarter with optimistic trade talks and a looming US rate cute helping boost returns,” TRS CIO Jerry Albright wrote in a report. The highest-performing asset class during the previous 12-month period was treasuries, beating their 12.3% benchmark and returning 12.7%.

The pension has also received its first contribution rate increase in nearly 25 years, as a result of new legislation. Advocates for the bill said it’s “the most positive legislative action for all TRS members in 25 years. The measure will make the pension actuarily sound immediately, rather than over the previously forecasted 87 years.