The Idaho Endowment Investment Board is getting close to pulling the trigger on $5 million maiden allocations to hedge funds-of-funds and collateralized debt obligations. The board, which also oversees $650 million in state-endowed land, is conducting a thorough review of the asset allocation and managers for its $220 million endowment fund and will examine how it has responded to reforms implemented by the state in 2000 to diversify its portfolio. Before 2000, the endowment's assets were all in fixed-income, but its portfolio now stands at 70% equity and 30% fixed-income. The endowment set a 10% long-term target exposure to alternatives last spring. "We have now gone five years under this new regime and we are going to take a look and see what's working and what's not," said Larry Johnson, manager of investments.
Johnson said the endowment will likely implement the move into alternatives and CDOs when the review is done. Initial results of the study will be presented to the state legislature when it meets in January. RBC Dain Rauscher is advising the fund.
The endowment's managers include LSV Asset Management, Mastrapasqua & Associates, Artisan Partners, Marvin & Palmer Associates, Oppenheimer Capital and Systematic Financial Management. The fund has returned 4.6% year-to-date.
Johnson replaced Matthew Haertzen as manager of investments on Sept. 30. Prior to this job he oversaw the retirement fund investments for Abitibi-Consolidated, a Montreal-based producer of wood products, and also worked as a financial consultant.
