Hedge Funds
CalPERS explores hedge fund comeback through managed accounts, 12 years after quitting the asset class
Records show the $653.8bn California pension has held talks with Goldman Sachs and Dockside Platforms on separately managed accounts; no decision has been taken.
HedgeWeekly Hedge Fund Desk ·
The California Public Employees' Retirement System is examining whether to return to hedge funds, this time via separately managed accounts, according to correspondence obtained by Pensions & Investments through a public records request and reported by Hedgeweek on Thursday. The $653.8bn pension has not reached a decision.
The documents show Dockside Platforms approached CalPERS in February about its work in the managed-account market, while Goldman Sachs made the case in May that hedge fund managers' uncorrelated returns could justify a fresh allocation. June Kim, CalPERS' deputy chief investment officer for capital markets, is reported to be leading the review. A spokesperson said only that the fund routinely assesses opportunities to make the portfolio more diversified and resilient while meeting its return target.
A move would reverse one of the most closely watched exits in the industry's history. In September 2014 CalPERS said it would wind down its roughly $4bn Absolute Return Strategies programme, redeeming from 24 hedge funds and six funds of hedge funds on the grounds of cost, complexity and limited scalability. Since then the fund has changed leadership, with Stephen Gilmore taking over as chief investment officer in 2024, and in July 2026 it adopted a total portfolio approach that manages risk across asset classes rather than in separate silos.
Why it matters: CalPERS' 2014 retreat was a landmark for public pensions weighing hedge fund costs, so even exploratory talks signal how far allocator sentiment has shifted. The focus on managed accounts rather than commingled funds also points to the terms large allocators now expect: position-level transparency, control over assets and lower costs, which favours managers and platforms able to run bespoke mandates at scale.