Rhode Island’s State Investment Commission has voted to terminate its investment in New York-based hedge fund firm Third Point following pressure from the nation teachers’ union.
The Providence Journal reported that Gina Raimondo, the state’s treasurer, said that the decision to drop Dan Loeb’s firm was not political but to reduce risk. The pension fund’s initial $50 million allocation to Third Point in 2012 earned a 49% return at the end of last year.
Rhode Island will get its money back in March, which will then be reinvested in other hedge funds. The state will pay $1.16 million in management fees for Third Point and $3.81 million for performance gains.
The American Federal of Teachers released a list of early 35 hedge fund firms and managers that it claims profit from pension fund investments while simultaneously supporting groups that attack traditional pension plans. Third Point was one of the listed firms.