Private equity sleight of hand makes so-so investments look superb, CalPERS says

In contracts over the last year, CalPERS, the largest U.S. public pension fund, has tried — so far without success — to eliminate these kinds of loans, known as subscription credit lines, according to people briefed on its concerns who requested anonymity to discuss private conversations. At CalPERS, private equity funds reported an average 12.1% annual return over the last five years, the most of any major asset class in the fund, which manages about $350 billion on behalf of 1.9 million public employees, retirees and their families.