[seibelj]

In a portfolio as large as Calpers, doesn't putting some money in an asset that has a 10 year return of 5.6% not a bad idea? I'm sure they need to be diversified.

[nibs]

Probably yes, but not when that 5.6% is coming from something inherently low-liquidity and high-risk.

[charlesdm]

The risk reward ratio just doesn't make sense. At best, you're getting public market returns, without the liquidity. At worst (most probably) your money is gone. Would you put money in that? I sure as hell wouldn't.

Private equity, now that makes sense.

[runako]

I would anticipate that if the 5.6% looks much worse when risk-adjusted to reflect that it's in illiquid speculative assets.

Besides, if I'm not mistaken, that trails equities and bonds over the period.