CalPERS's hatchet man, Ted Eliopoulos, goes on a manager firing spree, shaving hundreds of millions in management fees -- but is it enough?
For its most recent fiscal year, the pension giant paid $1.6 billion in fees, with close to 90% of that money going to the real estate, private equity, and egregiously pricey hedge fund managers
Stephen Winks
Boslego and Elipoulos expose the harsh reality in advisory services, a more modern approach to portfolio construction is clearly in order.
The question for retail investors is why would one pay for redundant account administration at the fund level, trustee level and the client level that adds no additional value? This is why 40% of the earnings on retirement savings is lost to commissions, fees and administrative cost. Calpers is just putting to bed myths advanced by the beneficiaries of those commissions, fees and administrative cost such as the practical use of hedge funds. As Jamie Dimon says, the industry must find a way to make it politically expedient to raise and resolve advisory services questions in the consumer’s best interest. This is terribly disruptive, in the best interest of the investing public and requires vision and leadership embraced by firms like Calpers.
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Stephen Winks
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