Quote:
Originally Posted by Slava
Just to be clear though, you can’t just copy the investments. It’s not like this is a portfolio of public equities where you just say “OK, they have 3.5% in Suncor, 4% Microsoft…” and mirror it. They’ve done all kinds of private equity deals, private credit and infrastructure that you can’t just replicate. You not only cannot get access to a piece of all those deals, but you can’t get the same terms and match that structure. But here’s a massive point that we should be considering; CPPIB is globally respected and they’re recognized for their competency for good reason. Why you would be in a rush to fix what’s not broken is beyond me.
Anyway, just thought I’d make it clear that you can’t replicate the CPP on a provincial level. And interestingly, if the province wanted to try, they’d be spending a pile more money to get a bunch of qualified people to run the private equity/credit and other like investments. They just fired the board of Aimco ostensibly because they weren’t happy with returns (which were completed fine, by the way) and they weren’t happy deemed too expensive (they were not!). I would be stunned to see them layout the kind of money you’d need to build this out to have the qualifications and similar roster to what you see with CPPIB.
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Think if you leave you’re not leaving with a cheque. You’re leaving with a portion of the investment pool. Probably a negotiated portion. So I guess it would be possible to negotiate a mirror of the setup at the point in time you seperate. Afterwards you are probably correct. I was just pointing out that the pension performance could be derisked by trying to invest in a similar fashion. But like most things I’m sure the new manager would want to put thier stamp on it inside whatever guardrails are in place.