At Pension Bridge: How Susan Oh Is Raising Diversity Awareness for Female Investors

PSERS’s risk parity director tells what prompted her passionate mission.

Susan Oh


Susan Oh had been working at the Pennsylvania Public School Employees Retirement System for 22 years before she noticed something: She was the organization’s only woman investor.

“The company has really provided a lot of opportunity for growth,” she said at a panel at the Pension Bridge conference in San Francisco. “However, I was the only female investor the whole time.”

Oh, a former NextGen here at CIO, said one of the biggest challenges is that there is an “unconscious bias” in the industry, or a previously made decision based on a stereotype a person may not be aware they have made.

“That has really delayed the process of having a woman having strong influence at the top from a management perspective,” said the director of risk parity, currency hedging, and strategic implementation at the Pennsylvania fund.

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Following years of running various portfolios, including non-US equities, portable alpha strategies, swaps, risk parity, and currency hedging, Oh lamented that she had not made the revelation until she had been asked to speak on a panel at last year’s annual conference.

“I realized when I was asked to participate on this panel last year, I started doing research and I found out that this is really an issue in this industry,” she said.

Oh, who is of Korean descent, and therefore hitting two investing outliers as both a woman and a minority, knew she had to start making an immediate difference. She started as a CPA, which she said has 50% female representation. However, the number of female investors is extremely low. She began to actively speak on diversity panels as often as she could.

“That led us to bring more awareness so I’m speaking to the management more about the need because I truly believe that this is the single most important thing that CEOs / CIOs can do to really sustain the business,” she said, reminding the audience that investors are in the business of “finding uncorrelated alpha.”

She also speaks at universities to bring awareness of the issue as well as encourage more women to take on the career path of investing.

“It really started with the intentionality, that’s the main focus, and trying to really honor the people who are in this profession, because they have persevered,” she said.

“There is just a pool of people who are ready to be awakened,” Oh said. “And I know that there is a pipeline that we need to work on, so it’s about bringing women in who are able to be promoted as well as being able to go beyond and founding their own companies.”

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At Pension Bridge: How a Utah Pension Plan Invests in Farmland

Organization’s head of agriculture and real assets explains what drove the fund to the space.

Pension funds invest in agricultural commodities, and putting money into farmland is becoming increasingly of interest.

Rich Matheson, the Utah Retirement System’s agriculture and real estate portfolio manager, explained at the Pension Bridge conference in San Francisco why his fund does just that, and how you can, too.

“As you look at a basket of various investment asset classes and you compare it to farmland, and include in the comparison inflation, what you find is a tremendous amount of non-correlation to other investment asset classes to farmland, and high correlation between farmland and CPI,” he said.

Some farmland-related investments are typically infrastructure or real estate-based, where organizations will buy the land to build property on it to enhance their long-term bottom lines. Utah goes the other way, putting preservation first, as land scarcity is a problem due to developments.

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“The mandate for our real assets portfolio is inflation protection, income production or cashflow, diversification, and asset preservation,” he said.

The program began about five years ago, when the fund started to invest in agriculture directly. The small allocation (a bit more than $150 million) is about 1% of the total portfolio, but it is diversified both globally and by crop type. Additionally, one of the main drivers that makes farms a no-brainer for Matheson is food.

“As GPD per capita grows, especially in emerging markets, demand for higher-quality food grows lock-in-step, and grows rapidly,” he said, noting that China and India, the world’s two largest population hubs, were where the plan took notice of this phenomena.

“In 2017, for example, China’s GDP growth was 6.9%, and India’s was 6.6%, that compares to 2.3% in the US. As that growth continues, the demand for higher-quality foods like animal-based proteins, nuts, berries, and such and shifting away or maybe migrating away from a typical rice-and-beans diet, the demand for those higher-quality food increases.”

As for the risk/return profile of the rural space, it is a low-volatility area, which furthers Utah’s attraction. It also harvests high returns, about 10.9% from 1998 through 2017, according to a chart from Matheson’s. Implied future returns are about 6%.

Matheson’s investment approach is similar to a private equity structure as the retirement plan invests in the space directly. “We’ve got a small allocation, as I mentioned, so that allows us to be more disciplined,” he said. “We’re not under a lot of pressure to place a lot of capital in a short amount of time.”

As to where the fund decides to put its money in the sector, the land itself is most important.

“We focus here on the ‘farm gate,’ as it’s called, right where the crop is grown,” he said. Another way to invest is on a macro level, where the fund will bet on either the gear and products the farmer will use to grow crops, and what they sell to the consumers.

Another is in the technology farmers use to harvest and produce their goods. “There has been a ton of capital flow into technology and innovation in the agricultural space and that was attractive to us in terms of increases in productivity and efficient use of water, seed technology, and whatnot,” he said, warning that investing in farmland isn’t easy, and there is currently no concrete way to measure performance. “What it really comes down to is the risk/return that you’re interested in.”

There are fewer investment managers in the space, so institutions still have a shot at being early. Although this is growing, farmers still hold most of the agricultural cards. “That’s evolving over time but it’s ultimately pretty difficult from an institutional investor’s perspective to invest meaningful capital in a short amount of time if that’s what you need to do,” Matheson said.

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Tags: Pension Bridge, Farmland, Real Assets, Agriculture, Rich Matheson, Utah Retirement Systems

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