SANTE FE, New Mexico (HedgeWorld.com)–The largest of the public investment funds in New Mexico will likely make its foray into hedge funds next month.

With US$12.5 billion in its permanent fund and assorted state investments, the New Mexico State Investment Council is about to make good on its promise to invest in hedge funds after a request-for-proposal process that began in January.

The State Investment Council won the right last year from the state legislature to place up to US$350 million into hedge funds. That allocation was delayed to allow for trustee education.

The statewide Prudent Investor Act went into effect on July 1 and allows state of New Mexico moneys to be invested in alternative investments, which include hedge funds.

The State Investment Council has set aside between US$500 million and US$1 billion that will be divided among roughly a dozen funds of hedge funds. Each of the firms selected were weeded out of a group of 70 applicants that was narrowed to the 25 fund managers that were interviewed. Officials would not disclose the names of the finalist firms.

The state’s two prominent pension plans also are considering hedge fund allocations.

Contact Bob Keane with questions or comments at: bkeane@investmentadvisor.com.