The decision by the California Public Employees' Retirement System to leave hedge funds was not meant to send a message about that particular sector, the pension fund's new chief investment officer told CNBC on Wednesday.
"It is not about the performance of the hedge fund program or about the industry in general. For us, it's ending the program because it doesn't serve CalPERS' purposes," said in an interview with "Closing Bell."
The $300 billion pension fund, the nation's largest, provides retirement and health benefits to 1.6 million Californians. Eliopoulos said the hedge fund investment was only $4 billion, or a little more than 1 percent of its portfolio.
"For us, in making our hedge fund decision, we looked at the relatively small scale of the hedge fund program and its real inability to have a meaningful impact on our total portfolio," he said.
"We also looked at the cost and complexity of the hedge fund program and decided that it just was not practical or beneficial for us to scale up the portfolio to a size that would be meaningful to our portfolio."
The CalPERS decision, made Sept. 15, caused a stir and led some to speculate about whether it would spark a movement. However, other pensions, investment consultants and money managers have since dismissed the idea that other public retirement plans will follow suit.