Fresno County (Calif.) Employees’ Retirement Association named ARGA Investment Management, Dimensional Fund Advisors and Pzena Investment Management as finalists in a search for a manager to run about $150 million in active emerging markets equities.
The $5.6 billion pension fund’s board approved the firms as finalists at its Sept. 7 meeting, said Donald Kendig, retirement administrator, in an email. The firms will make presentations at its Nov. 2 meeting and a selection will be made shortly thereafter.
The pension fund had conducted a shortlist search due to style-related concerns with current manager Mondrian Investment Partners. mr. Kendig said that while Mondrian is a fine manager, the pension fund wants to split emerging markets equities into value and growth portfolios and is considering replacing the firm with a manager that has lower correlations with Baillie Gifford & Co., which runs about $127 million in active emerging markets growth equities.
FCERA will decide whether to hire a new manager and terminate Mondrian or retain Mondrian following the finalist presentations.
As of June 30, the pension fund’s actual allocation to international equities was 19%; the target is 21%.
Investment consultant Verus Advisory is assisting.