New Mexico SWF Updates Private Equity Strategy

The New Mexico State Investment Council (NM SIC) is updating its long-term strategy for its private equity portfolio.  One major change includes committing around $350 to $450 million per year to private equity until 2016. In addition, like other public investors, the long-term strategy includes larger commitments to a smaller pool of managers, thus limiting relationships to fewer than 50 and less than 100 funds. Another big change is a shift in geographic strategy to increase allocation to emerging markets and Asia which now represents 3% of the private equity portfolio.

Three major themes:

  • Focus on quality core relationships
  • Bigger commitments to fewer managers
  • Improve diversification by geography and strategy

NM SIC Approved Private Equity Strategy

  • Venture Capital: 0% – 10% and 0 to 5 managers
  • Growth: 10% – 20% and 5 to 10 managers
  • Buyout: 50% – 70% and 12 to 17 managers
  • Special Situations: 10% – 25% and 4 to 8 managers

*Special situations include distressed debt trading, mezzanine, energy, fund of funds and secondary strategies.

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