Public pensions from California to Ohio are backing away from hedge funds because of concerns about high fees and lackluster returns, The Wall Street Journal reported yesterday. Those having second thoughts include officials at the largest public pension fund in the U.S., the California Public Employees' Retirement System (CalPERS). Its hedge fund investments are expected to drop this year by 40 percent, to $3 billion, amid a review of that part of the portfolio. A spokesman said that the fund is taking more of a "back-to-basics" approach with its holdings. The retreat comes after many pension funds poured money into hedge funds in recent years in the hope of making up huge shortfalls.
