Calpers cuts Big Tech holdings 26% as it expands private equity exposure
California Public Employees' Retirement System (Calpers) has reduced its holdings in the seven largest US technology stocks by 26% while increasing allocations to private equity, as the $640bn pension fund seeks to diversify its portfolio amid concerns over elevated public market valuations, according to a report by the Financial Times.
Calpers, the California Public Employees’ Retirement System, has cut its holdings in the seven largest US technology stocks by 26% while simultaneously increasing its exposure to private equity. This strategic shift, reported by Private Equity Wire, aims to reduce concentration risk and provide more attractive valuation opportunities in privately held businesses.
Anton Orlich, Calpers’ deputy chief investment officer, explained that the move would help diversify the pension fund’s portfolio as public market valuations become increasingly elevated. However, concerns remain regarding the valuations of privately held AI companies and whether such investments offer sufficient diversification from the technology sector.
Despite private equity underperforming relative to listed equities over the past three years, the shift is being driven by the potential for generating returns and strategic acquisitions in a challenging IPO market.
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