The Santa Monica-based investment firm, that has assisted CalPERS for 22 years, performs independent analysis and recommendations on asset allocation, investment policies, money manager selection, and general investment industry trends.
Wilshire is known for being the architect of CalPERS Permissible Market Equity Policy and author of "The CalPERS Effect," a study that shows the economic impact of the pension fund's shareowner activism.
"Wilshire has provided outstanding professional guidance for this Board and its staff for over two decades," said Rob Feckner, President of CalPERS Board of Administration. "Our members and employers can be assured that under their watch our investments are in good hands."
Wilshire Associates contract will be effective July 1, 2005 and will last three years with the option of two one-year extensions by CalPERS. The contract is subject to final negotiations of fees, terms, and conditions.
In related investment actions, CalPERS selected eight managers to be part of pools that will manage international equity enhanced index strategies and international active management for the pension fund.
CalPERS will rely on managers from a "spring-fed pool" to launch its international equity enhanced indexing strategies. It will use a second pool to potentially add to its line-up of active international equity managers. Currently, the System uses eight managers to actively invest $5.9 billion in international stocks.
Barclays Global Investors, Baring Asset Management, and JP Morgan Fleming Asset Management are in the pool for international equity enhanced indexing services, which is designed to yield superior index returns without increasing risk.
The pool of active international equity managers includes Alliance Capital (International Strategic Value), Alliance Capital (International Large Cap Growth), PanAgora Asset Management, New Start Institutional Managers, and The Boston Company Asset Management.
"These pools will enable us to respond more quickly to developments in today's rapidly changing marketplace," said Chuck Valdes, Chair of CalPERS Investment Committee. "This new streamlined process will help us move our money opportunistically with more flexibility than in the past, generating improved returns."
CalPERS investment managers will be on annual review contracts providing for an undefined duration and will be subject to successful negotiation of fees and terms.
CalPERS is the nation's largest public pension. The System provdes retirement and health benefits to more than 1.4 million State and local public agencies and their families. For more information on CalPERS, visit www.calpers.ca.gov.
