American Century Lands $530 Million Investment From Arizona State Retirement System

Arizona welcome sign

The Arizona State Retirement System has invested $530 million with American Century Investments. As reported by the Kansas City Business Journal:

The investment will be placed in the American Century Non-U.S. Growth strategy, which looks for companies with a market capitalization of $3 billion or more, with accelerating growth and improving fundamentals. The overall portfolio typically invests in about 90 to 135 companies.

The investment management team is led by Senior Portfolio Manager Rajesh Gandhi, a 17-year financial services veteran who joined American Century in 2002.

The Arizona State Retirement Systems manage $34 billion in assets for 500,000 members.

Portfolio Manager Rajesh Gandhi explains his investment strategy in this video, courtesy of American Century.

Houston Firefighters Fund CIO Resigns

Houston Fire Truck

Christopher Gonzales, the Chief Investment Officer of the Houston Firefighters Relief and Retirement Fund (HFRRF), resigned from his position today. As Pensions & Investments reports:

Mr. Gonzales said he has taken a position with a corporate retirement plan. He declined to provide further information. He has been CIO at the pension fund for 13 years. His last day is Sept. 12.

The board will discuss how to handle the upcoming vacancy at a special board meeting on Thursday, said Chairman Todd E. Clark.

Notably, Gonzales is a staunch supporter of private equity investments. The most recent data reveals the HFRRF allocated just over 10 percent of its assets towards private equity in 2013, but that number was once as high as 18 percent.

In an op-ed written for Pensions & Investments in January 2014, Gonzales lauded the performance of his fund’s private equity investments:

For the second year in a row, the Houston Firefighters’ Relief & Retirement Fund was among the top ranked in the Private Equity Growth Capital Council’s top 10 pension funds by private equity returns.

HFRRF earned a fourth-place spot in the private equity return ranking with a 13.6% annualized return, net of fees, over the 10 years and 9.3% over the five years, ended June 30, 2012.

Returns have shown consistency. In the 10 years ended June 20, 2011, the PEGCC study ranked HFRRF seventh best in private equity portfolio performance.

The PEGCC’s report showed that private equity returns to large public funds outperformed all other asset classes with median annualized 10-year returns of 10% for the subset of 146 large public pension funds that published 10-year returns ended June 30, 2012.

The HFRRF returned 11.24 percent, net of fees, in 2013 after returning 1.89 percent in 2012 and 20.29 percent in 2011.


Photo by Daniel Fleming via Flickr CC License