How to Invest with PRIM?
There are two ways to invest with PRIM, either as a participating system, meaning a retirement system can elect to transfer all assets to PRIM, or as a purchasing retirement system, which elects to invest some of their assets with PRIM.
A “Participating System” elects to transfer all its assets to PRIM. Mandatory five-year period of participation. An affirmative decision by the Retirement Board requires notification to chief executive officer and legislative body having jurisdiction over the Board and the PRIM Board.
A “Purchasing System” elects to invest some or all of its assets in the total PRIT Fund, or in the asset class sleeves offered by PRIM through “Segmentation”. A majority vote of the Retirement Board is all that is required to become a Purchasing System. No minimum dollar investment period. A Retirement Board may terminate its relationship with 30 days’ notice per PRIM’s Operating Trust.
For local systems that may want to pursue their individual asset allocation strategy within the PRIT Fund (as opposed to adopting the allocation strategy of the overall PRIT Fund), retirement boards can elect to invest in individual asset classes, or “segments,” of the PRIT Fund as an alternative to investing in the aggregate Fund. The segmentation option gives local retirement boards flexibility to choose specific asset classes in whatever proportions they believe best suits their needs.
The strategic and tactical asset allocation of the PRIT Fund composition and its portfolios are subject to change without notice as determined by the PRIM Board and may not all be available through segmentation. The following asset classes are currently unavailable to Massachusetts Retirement Systems through segmentation: private debt component and other credit opportunities of the value-added fixed income, timberland, and specific investments within the Portfolio Completion Strategies (PCS) Portfolio (Risk Premia and Real Assets) and the Put Spread Collar The following asset classes are available in segmented sleeves are the following: Domestic Equity, International Equity, Emerging Markets Equity, Core Fixed Income, Value-Added Fixed Income, Real Estate, Private Equity (Vintage Year), Hedge Funds.
Operating Trust Agreement
Investment in the PRIT Fund is subject to the provisions of the Commonwealth of Massachusetts, Pension Reserves Investment Management (“PRIM”) Board, Operating Trust, as on September 22, 1998, as amended from time to time (the “Operating Trust”).
Public Employee Retirement Administration Commission (PERAC)
There is no statutory provision requiring a retirement system to seek a waiver from PERAC to invest in the PRIT Fund or individual asset classes, or “segments,” of the PRIT Fund as an alternative to investing in the aggregate Fund.
Please call PRIM’s Director of Client Service, Francesco Daniele, at (617) 946-8416 or PRIM’s Senior Client Services Officer, Laura Strickland, at (617) 946-8490 for additional information about investing in the PRIT Fund or the available segmented portfolios.