The New Jersey Division of Investments plans to move as much as$500 million into its high-yield portfolio in 2014.

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The division manages seven Garden State pension funds totaling$74.3 billion in assets. The move expanding high-yield holdings isscheduled to occur in the division’s second-highest revenue plan,with holdings currently at $3.5 billion. A $100 million investmentin high-yields already occurred in May.

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“We try to take advantage when things go down,” divisiondirector Tim Walsh told reporters. “If we get a little concerned,we’ll take money off the table.”

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The New Jersey division is also considering an investment infloating-rate debt in an effort to take advantage of an expectedrise in interest rates. Walsh said the state has triedfloating-rate debt in the past on a very small scale.

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New Jersey Gov. Chris Christie signed a pension reform bill in2011 designed to make up for 15 years of the state underfunding itspensions and set a goal of full funding by 2018. However, thebill has put the state in a bind, requiring an additional $600million in annual contributions from the state totaling $5.5billion.

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