Alaska Permanent Fund Corporation Board of Trustees authorized a new asset allocation

“The Alaska Permanent Fund Corporation Board of Trustees authorized a new asset allocation and approved a manager search during their regular meeting on May 20 and 21 in Anchorage.

‘We’re taking a fresh approach to how we view our asset allocation,’ said Michael Burns, CEO ‘We’re recognizing that some investments within an asset class may have more in common with other asset types with regard to expected risk and return. And since our goal at the highest level is to balance the risk and return of the total portfolio, it makes sense to segregate assets by their characteristics, rather than simply by type.’

The new asset allocation is as follows:

2% – Cash (investments with a duration of less than 12 months)
6% – Interest rates (government or government related bonds)
53% – Company exposure (stocks, corporate bonds and private equity)
18% – Real assets (Real estate, infrastructure and TIPS)
21% – Opportunity pool (includes absolute return and distressed debt)

The allocation includes real return mandates, a new asset allocation for the Permanent Fund. In the Fund’s absolute return mandate, managers generally focus on publicly traded assets, such as stocks and bonds. Under a real return mandate, managers would invest in the same range of assets as the Permanent Fund. They would be required to structure their portfolios to meet a 5% real return target with a same level of risk as the full Permanent Fund portfolio.”

read more: APFC



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