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California  + Retail  | 

CalPERS Considers Using Portfolio Leverage if Economy Turns

CalPERS may adjust its investment strategy as part of an effort to prepare for economic downturns should quick action be required. The $365.1-billion pension fund’s CIO Yu Ben Meng noted one of the options under consideration is placing leverage on the portfolio, which would impact the total fund’s leverage policy.

That option surfaced when Ben Meng responded to a question from Lynn Paquin, a board designee, about potential investment policy changes staff could request in order to act more quickly during a market drawdown. He was quoted as saying, “one of the undesirable outcomes during a drawdown is we don’t have money to deploy to take advantage of a market dislocation. And, one of the ways to generate additional liquidity is put on leverage on the total fund. So, we borrow money.”

Ben Meng indicated a plan is currently being developed and would be presented to the investment committee to consider an investment policy change, if needed. CalPERS has entertained the use of leverage in the asset allocation work for years.

For comments, questions or concerns, please contact Dennis Kaiser

Connect

Inside The Story

Read more at Pension & InvestmentsConnect With CalPERS’ Ben Meng

About Dennis Kaiser

Dennis Kaiser is Vice President of Public Relations and Communications for Connect Creative. Dennis is a communications leader with more than 40 years of experience including as a journalist and in corporate and agency marketing communications roles. He is responsible for Connect Creative’s agency client services and is involved in a range of initiatives ranging from public relations and content strategy, communications and message development, copywriting, media relations, social media and content marketing services. Prior to joining Connect Media in 2015, his most recent corporate communications roles involved leading a regional public relations effort across Southern California for CBRE, playing a key marketing role on JLL’s national retail team, and directing the global public relations effort at ValleyCrest (BrightView), the nation’s largest commercial landscape services company. He has worked on marketing communications assignments for such CRE companies as Blackstone/Equity Office, Carlyle, Caruso, Disney Resorts, GE Capital, Irvine Company, Hines, Howard Hughes Corp., Jeffries, Lennar, MGM, Marcus & Millichap, Prologis, Raleigh Studios, Simon, Starwood, Trammell Crow Company, Transamerica, UBS and Wynn Resorts. Dennis has also worked on communications and launch strategies for a number of consumer electronic, media and tech brands including SlingMedia, Channel Master, Deluxe Media Entertainment, BeIn Sports, EchoStar and Sprint. Dennis’s agency background included firms such as Off Madison Ave., Idea Hall and Macy + Associates. He has earned an outstanding reputation with organization leaders as a trusted advisor, strategic program implementer, consensus builder and exceptional collaborator. Dennis has developed and managed national communications programs for Fortune 500 companies to start-ups, both public and private. He’s successfully worked with journalists across the globe representing clients involved in major-breaking news stories, product launches, media tours, and company news announcements. Dennis has been involved in a host of charitable and community organizations including the American Cancer Society, Easter Seals, Boy Scouts, Chrysalis Foundation, Freedom For Life, HOLA, L.A.’s BEST, Reach Out and Read, Super Bowl Host Committee, and the Thunderbirds Charities.

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