How I Invest with David Weisburd

E296: Former CIO of CalSTRS on Why LPs Overpay for ‘Innovation’

12 snips
Feb 3, 2026
Guest
Christopher Ailman
Christopher J. Ailman, former CIO of CalSTRS and now founder of Ailman Advisers, reflects on 23+ years shaping a top public pension. He argues governance and asset allocation drive most outcomes. Short takes cover cutting costs with in‑house scale, avoiding shiny investment trends, building resilient portfolios, and hiring diverse thinkers for long‑term success.
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ADVICE

Use Scale To Cut Net Fees

  • Use scale to negotiate lower fees and run inexpensive strategies in-house where sensible.
  • Spend on active management selectively and avoid chasing expensive, fashionable strategies that erode net returns.
ADVICE

Build In-House Execution Where It Saves Costs

  • Build internal capabilities like passive equity and fixed income to reduce recurring manager fees.
  • Consider owning stakes in operating firms or negotiating co-investments to capture more economics.
ADVICE

Don't Chase Fashionable Strategies

  • Avoid chasing shiny new strategies like GTAA/global macro unless you have durable edge and clear net benefit.
  • Favor clarity and long-term discipline over frequent tactical overlays that add cost and complexity.
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