Emerging market funds might not seem like the obvious place for performance improvements given this year’s economic uncertainty in developing markets.
But through the first quarter, they did just that. At least those venture-related holdings in the California Public Employees’ Retirement System’s 57 Stars Emerging Markets and EMAlternatives Investments portfolios.
Almost three out of four of the 18 venture-focus funds in the two portfolios advanced during the nine months ending in March, according to a recent portfolio report. Several made significant gains, including funds from Softbank China Venture Capital, New Horizon Capital and CDH China Management.
The portfolio is heavily weighted toward medium-sized funds with a broad mandate of balanced or generalist investing. Only two have investable capital of $900 million or more.
The portfolios also are maturing. Fund vintages are 2007 to 2009, meaning they should now be putting up results.
Several at the top of the portfolio truly are. Giza Venture Fund V held onto the top ranking with an IRR of 32.5 percent as of March, the portfolio report shows. The SBCVC Fund 3 from Softbank, which CalPERS holds in both accounts, made a substantial gain over the period with an IRR of 18.3 percent as of March, up from 7.2 percent in June of 2013.
Actis Africa 3 continues to perform well, but New Horizon Capital III made even bigger performance gains to an IRR of 13.9 percent.
The accompany table lists the entire 18 funds with commitment levels, distributions, investment multiples and IRRs.