A panel of experts offered feedback on California Public Employees’ Retirement System’s plan to create a long-duration captive private equity fund, saying long-term or permanent investments could add value but would have lower returns than traditional PE.
The $346 billion pension has proposed a new investment model that would create two CalPERS -controlled PE funds, Horizon and Innovation. If approved, the Horizon fund would invest long term in large “core economy” companies, while Innovation would focus on late-stage investments in life sciences, healthcare, and tech.
Experts invited to speak at CalPERS’ January offside board meeting gave mixed feedback on the Horizon proposal.
“One of the things that gets a little lost in this discussion of long-term investing is there aren’t that many companies that you know when you buy them that you’d like to hold them for 20 years,” said TPG’s Jonathan Coslet.
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