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R.I. withdraws $340 million from hedge funds as implementation of 'Back to Basics' continues

PROVIDENCE, RI - Rhode Island's pension system has hit a milestone in its move away from hedge funds, recouping more than $340 million to date General Treasurer Seth Magaziner announced today.

"We are moving away from the high-cost hedge funds that have failed to meet expectations while charging unacceptably high fees," said Treasurer Seth Magaziner. "Our new Back to Basics strategy will improve performance and reduce risk, providing a more secure future for Rhode Island public employees and all taxpayers."

Exiting underperforming hedge funds is a component of Magaziner's 'Back to Basics' investment strategy, unveiled last year after an intensive review process involving some of the state's leading investment experts. Additional hedge fund redemptions are expected in the coming months, as implementation of 'Back to Basics' continues.

Performance has been strong for the pension system in recent months. As of March 31, the $7.9 billion pension fund has achieved a one-year return of 10.81%, beating its own benchmark of 9.96% and a 60% stock/40% bonds portfolio which would have earned 9.02%.

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Related links

  • Department or agency: Office of General Treasurer Seth Magaziner
  • Online: http://treasury.ri.gov
  • Release date: 05-03-2017

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