Texas ERS, PAAMCO Launchpad to Hold Fall Emerging Manager Hedge Fund Event

Emerging hedge fund managers will get a chance to show their stuff this fall as the $28 billion Employees Retirement System of Texas and PAAMCO Launchpad host their first emerging manager hedge fund event in New York City. Forty managers will be invited after an email-based vetting process.

The event, which takes place on October 24 and 25, seeks to reel in talent for the PAAMCO Launchpad program, which commenced in June. The operation is a co-investment platform that seeds emerging hedge funds. Once the emerging funds are well-positioned (and funded) for success, they are rotated out for new ones. The involvement of Texas, which wants emerging manager investments to make up 10% of its portfolio, helps grow its $1 billion emerging manager program.

Andrew Gitlin, the seeding platform’s chief, expects the program to “help evolve the hedge fund industry and will showcase the important role emerging managers play in institutional portfolios.”

At the gathering, the platform’s team will talk about Launchpad’s mission, and the chosen managers each will be given a half-hour to present their strategies and hedges to PAAMCO Launchpad and Texas officials.

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Sharmila Kassam, Texas’ deputy chief investment officer, called PAAMCO Launchpad “an innovative solution for supporting investment professionals considering their critical next career step toward their goals of becoming the newest and best emerging managers.”

Managers interested in attending and pitching their organizations at the event must email ERS@paamcolaunchpad.com.

A PAAMCO Launchpad spokesperson told CIO that the two businesses will evaluate the managers and their strategies to determine if the funds would fit the program. The process can take anywhere from a few weeks to a few months.

“We will be in regular communication with managers post the event to articulate any next steps as relevant (document request, references, additional meetings, track records, etc.). We are open to managers that are generally early in their life cycle (pre-launch as well as acceleration capital) – we have no hard and fast rule on size. We are open to all strategies that have ample capacity and are timely given expected market conditions,” the spokesperson said.

Tags: Andrew Gitlin, Hedge Funds, PAAMCO Launchpad, Texas Employees Retirement System (ERS)

Norges Bank Investment Management, which runs Norway’s 8.3 trillion krone ($988.2 billion) sovereign wealth fund (the world’s largest), reported 1.8% returns for the fund’s second quarter Tuesday morning.

Norges Bank, which runs the Government Pension Fund Global’s equities, returned 2.7% in the period ended June 30, reversing a first quarter downturn. Unlisted real estate investments gained 1.9%. Fixed income was flat. Earnings were 0.2 percentage points under the benchmark. Last year, the fund returned 2.6% for the second quarter.

“North American and European stocks had a positive development in the quarter despite the prospect of increased trade barriers,” said Trond Grande, Norges Bank’s deputy CEO, who noted that the period’s $19.8 billion boost gave the fund its first inflow since 2015 due to a strong recovery from oil prices. For example, ICE Brent crude futures were trading at roughly $28 per barrel at the end of 2015. At the end of June 2018, it hit a $79 high.

During this time, the Norwegian krone depreciated against the dollar, which increased the fund’s value by $5.5 billion despite losing some worth when converted to USD (it was previously appraised at $1 trillion).

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In addition, 2 billion krone was withdrawn from the fund.

As a whole, however, the bank still suffered a quarterly outflow.

As of June 30, the Government Pension Fund Global had allocated 66.8% to equities, 2.6% in unlisted real estate, and 30.6% in fixed income.

Tags: Government Pension Fund Global, Norges Bank, Norway, Returns, Sovereign Wealth Fund