Another pension fund has backed away from hedge funds.

Stung by high fees and weak performance, New Jersey, on Wednesday, joined New York City and California as the latest government sponsored-pension fund to cut back on how much money it places with the hedge funds.

The New Jersey Investment Council unanimously voted to cut its allocation to hedge funds to just 6 per cent, a figure down from 11.7 per cent.

The $71.9 billion (£54.05 billion) fund will move the cash from hedge funds to a mix of stocks — both domestic and international — as well as potentially investing in other, less costly, alternative asset classes.

The decision to scale back hedge fund investments was not without controversy.