10X Capital Podcast E78: Fmr. CIO of CalPERS ($495 Billion) on Private Markets Investing
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Jul 18, 2024 Dr. Russell Read, a seasoned investment professional and current CIO at 10X Capital, shares his invaluable insights from his tenure at CalPERS and other major funds. He discusses the complexities of investing in private markets, focusing on co-investment programs and the importance of staff effectiveness. Russell highlights shifting strategies towards international investments, the challenges of size in alternative assets, and the evolving landscape of pension funding. His experiences reveal the balance between structured allocation and the flexibility needed in today’s dynamic market.
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Internationalizing Portfolio Requires Benchmark Shift
- Internationalizing a portfolio begins with changing its benchmarks to include global markets.
- This compels investment teams to seriously consider wider opportunities beyond domestic ones.
Why Increase International and Private Allocations
- Expanding international exposure captures global growth opportunities.
- Allocating to private markets captures an illiquidity premium crucial for meeting actuarial return goals.
Focus Private Investments by Fund Size
- Large funds focus private market investments on large-scale opportunities.
- Venture capital is hard to scale effectively for giant funds, narrowing focus to big private equity, real estate, and infrastructure.