This presentation is a short review of discussions carried out by Ben with CalPERS since 2015. It highlights the shortcomings of CalPERS Board of Governance regarding the prudent and reasonable reduction of uncompensated risk and the lack of a procedural process in their Total Fund Policy Statement. It states that CalPERS is in breach as they were in 2017.
CalPERS left 40 basis points on the table in 2016 compared to a reasonable uncompensated risk portfolio. For CalPERS that meant leaving $1.2 billion each year which, over 12 years, at a target rate of 7.5%, could accumulate to $19 billion dollars.
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