##VIDEO ID:sk4tnta8nTI## begin call Nick Curry here Dan Jans Christine Hoffman here Brandon maresma here Jennifer Rell David cohill present John patr here Matthew gry here John Cell Jason Shar here George Candler here Ed Dawson here John McDaniel here Lance hsh here de white here office Jennifer some minutes this is the general board special pension board meeting held on September 27th 24 so second roll call or just can do just okay all in favor oppos and then the special pension board meeting held on October 31st 2024 all in favor okay retention board meeting held all right so I need first for approving this second in favor herrer I am I aming one of the additions I apologize congratulations condolences right perspective is uh so good good afternoon everyone I hope hope everyone's doing well so I just have a couple things to go over with you none n necessarily actionable uh but obviously you know if you have any questions or anything like that please please feel free to jump in uh I'm not certain if you've had a chance to take a look at the special report that we prepared uh your agenda package um no no no no worries if not just you get a chance you want to put yourself to sleep you can take a look at it tonight but essentially the legisl amended uh two statutes last legislative session with changes that are became effective as of July 1 of 24 uh and and in some this is July 1st of of next Su 2025 uh but theang really pertain to uh governmental agencies here in the State of Florida certain requirements that now uh are needed uh if any new contract or or is either entered into or or extended um and so I think operationally it's not really going to have an impact just based on uh the types of relationships or or or engagements that the Pension funds have at the institutional level um don't don't really I think lend themselves to to abing with these kinds of uh amendments but nonetheless we'll comply with it um and and will be uh be fine administrative so the First Amendment really is is uh to a statute 287 um and it's the foreign countries of concern so the state has identified uh specific countries uh that it regards as not to be redundant concerning I guess to be po uh and I would say it's the usual suspect that you would think of when when these kinds of lists are developed so it's it's China it's Russia it's North Korea um Iran uh Syria Cuba and Venezuela so um if you if governmental agency is entering into a contract and the counterparty um needs to attest or verify that it is not a quote unquote company of concern a of concern is essentially one that's either uh domiciled in operated by or or owned by right one of these app mentioned countries of concern so um we drafted an affidavit and we will be circulating those to all of your service providers so so uh you know our firm obviously included um and we'll all sign off for attest to the fact that that we're not a a quotequote company of concerned then going forward any new engagement any new uh relationship uh it'll be a term and condition of the contract um and and we'll have the affidavit attached as a as an exhibit uh as currently we have uh if you guys recall a few years ago there was a a public entity crime bill that was that was enacted or passed um and now you know vendors to to government AG have to have to pass to certain certain uh conditions that they hav't been violated or convicted certain crimes or public entity issues so uh similarly this is just an additional kind of hoop to jump through U for for governmental agencies but you know again I think practically speaking luckily it won't we won't really have much of an impact um and and and so I wanted to also emphasize uh that that this does not pertain to um this does not pertain to uh your investment uh your Investments are regulation are governed by another set of laws um and if you guys recall the protecting Flor Investments act um and and so the this this amendment or or or this new law really only speaks to a direct contractual relationship right between the pension fund and uh in thir party so I just want to clarify I know that that that may be something that that obviously comes to mind any of um so it does not apply in that that okay any questions or anything on that no okay um and then uh the the second amendment was to similarly the statute that that you don't generally hear too often uh that's 787 and this is the the human trafficking statute um and so obviously in kind of continuing efforts to curve and human trafficking uh the state now for governmental agencies uh need again the counterparty right the the the the firm entity that's entering into the agreement with the governmental entity or in this case the Pension funds uh they need to certify assest to the fact that they do not quotequote use coercion for uh for labor and or Services um and you know actually goes on to Define you know what coer means and threatening a physical Force you know isolating confining someone using debt to create this adventure servitude model right um but again nothing nothing I think too meaningfully uh impactful uh we drafted an affidavit again for for all your current providers uh to go ahead and sign off on and then you know again it'll be a term and condition of the contract going forward uh and the P doesn't exhibit um we'll we'll have all of the uh all of the bases covered with respect to your contractual obligations in the state law um and and hopefully hopefully it won't cause too much of an issue outwhere any questions or anything on that no okay um excellent uh so this is uh also I usually take this opportunity uh since we're getting into the giv uh I usually take this opportunity just to to kind of refresh everyone in terms of their obligations under State ethics laws as you guys are are aware by virtu of your service on the board you are technically considered a public official and so therefore subject to St that in FL so um I know um you've probably heard this before but so I apologize but I think it's I think it's just a good practice to have it as part of our as part of our meetings and I won't take too much time but essentially um if you receive something of value uh regardless of the value that that you believe is being given to you some re form go influence your decisions on the board you should obviously reject that um if you receive something that's valued uh between $25 or less you can accept it and and there's no reporting requirement uh if you receive something that SI $25 and $100 you can similarly accept it there is a reporting requirement on behalf of the gift give or right the person or the company that gives you the gift uh should be reporting that with the St uh and then anything over $100 you should not accept and we generally recommend uh filing a form with the state that's advising that that you received the gift who gave it to you the value of the gift uh and ultimately the disposition of it right what you did is you donated it you returned it toer whatever the case may be okay hello oh sorry I'm sorry I thought I lost you guys um okay good um and and so then the only other item I just wanted to let you guys know is so historically we we did uh provide holiday GI through they were always valid at L than 25 um but after uh after Co we kind of had to Pivot away from that for for logistical reasons and since then we have that made charitable donations in each of our our client names on on your behalf uh and so we'd like to continue that practice this year and so no no action required just wanted to let you know that we we'll be making a donation we haven't decided yet uh either to we generally just make donations either the local food bank uh or has happened in the last couple years with the storm uh Hurricane Relief efforts so I think um so so we have toci of the two which one we're doing yet but but I believe that that's that's what we're going to be doing and so I just want to let you know uh that we'll be we'll be doing that practice again continue that practice this year but um hopefully that's that's okay on your end we figure those are two fairly uh non-controversial apolitical uh Charities and so he to work out well for everybody there perfect okay and and that really concludes my uh my report unless anybody has any questions or anything anything they need from from I'm going to consider ethically trained per payro for this for this calendar year I think you know I think it's I think you can do it you got your city anyway so I feel like you've been through this you've been through this a couple times okay thanks Pedro yes sir of course um and so I I don't know I'm going to I was going to sign off but but obviously I spoke to Dustin beforehand and and he said if anything came up you know he can uh he can get a hold of me I'll be I'll be available so uh please feel free if if you have a question um I'll be uh I'll be here in thank you all right everybody take care have a great tomorrow good holiday take care everybody bye bye okay so next up is winds low and clear brid Bren do you want to make introduction yeah well just really quickly uh we have a book with the the two managers in front of you we we'll kind of use this as a as a reference after the presentations just want to uh pee that up for you that we have kind of updated information on just those two strategies for you to to kind of look at when we discuss later um so we're going to hear from new Windslow um first um and then clearbridge and again the idea is we have made the recommendation to move on from all spring our large cap growth manager these are the two that that you short listed last time to want to hear from um I think we had discussed kind of 20 minutes um the presentations and questions is that still good for the for the group good for me okay with that we'll we'll have winds low come up and and kind of go ahead and begin and you should have the books in front of you there are these kind of medium dark with the white on the bottom good afternoon um for those who don't know me there's a lot of familiar faces in the room G by my name is Greg gosh with vice president institutional Business Development I'm joined by Barry Peters from Winslow on our senior team with with Winslow Winslow uh is the growth Specialist of new um probably like well who's new me uh we are $1.68 trillion money manager uh Global money manager who is owned by Tia owns both of us and the reason I bring up TI is Tia is the largest uh retirement system not called Social Security in the Western Hemisphere and tia is responsible for the retirement for 5 million higher educational professionals the reason I tell you this like why is Greg going into all these different names and numbers and things like that but the alignment of interests of what we do every day what the Winslow team does every day what the inv the different companies with inine do on a daily basis is has very aligned interests what with what you do every day for your pensioners so when we wake up every morning we're focused on our pensioners internally and externally I think that makes a difference between what we do and a lot of our competitors um with that uh I'm going to hand things off to VAR and uh kind of get into things you said 30 minutes or 40 minutes 20 minutes already trying to steal more time no no no but thank you again for having us have a great Thanksgiving and I'm sure I'll pop in here on something else thank you thank you all for the opportunity to present to you this afternoon I really appreciate any opportunity to get out of Minneapolis once the snow starts flying if you're not familiar with our weather I uh have t eight-year-old daughters and I was tricky treating in fresh few weeks ago so we're officially in get me out of town season the only way it could be more compelling is if you did it during your cold snap in January or February but I understand why you all here um I bet none of you um I'm going to introduce you to Windville Capital uh we are a boutique firm we've been based in Minneapolis for 32 years large cap growth is all we do as an organization we are maniacally focused on doing doing it well and doing it consistently well Clark wiel our founder had a lot of rules that he ran his life by he's still alive and happily retired but one of them is you can't be excellent at a lot of things anybody who's truly great at what they do is probably truly great at that one thing I grew up in New England I'm a Boston Red Sox fan I will openly admit so I hate any sports analogy that involves the New York yane this way right the New York Yankees didn't create a team that won 24 World titles by having a bunch of generalists right utility infielders a bunch of people who were kind of good at a lot of different things right they built teams year after year with individuals who are exceptional at what they did and then put them together as a team and that's what's responsible again grudgingly as a Red Sox man for those 24 World titles wio Capital think special as an organization is like most organizations our people are what makes us special but what makes us unique is our investment process and I'm going to spend the majority of my time here in the next few minutes introducing you to that there's a little phrase that we associate with it and it's called a no preferred habitat approach to growth investing so that weird little three-word phrase is what wom's little capital is known by but it ties back to what our goal is as a manager and I'm going to that I'm willing to bet no manager has ever sat here and said to you our objective as an organization is not to try and be the best performing large capap growth manager in the industry that is not what we're trying to do because simple logic dictates that if you're taking enough risk to be the absolute best when you're right you're also taking enough risk to be one of the absolute worst when you're wrong and no matter how smart you are you've been doing this eventually the market will give you a set of conditions where what you like to do maybe doesn't work so well right so you have to focus on in our view being consistent We Believe consistency of performance should be every Investor's ultimate objective so everything we do as a company is based on delivering on that goal consistency that's why we have this manal Focus this is one big it's why we don't have a small cap product an international product a global product a fixed income product we do one thing and we do it well you'll turn to the second page I'm not going to use the slide presentation because more often than something goes wrong with the technology so we're going to go old school this morning I want to introduce you know our approach in order to be consistent you can't and many of you probably seen lots of these presentations over the years right your 10 you're here you start with an inverted funnel right and in the top of the funnel goes all the things that your investment Universe all the things you could invest in and then you go through a bunch of steps in your investment process and narrow down this broad investment universe that you could invest in to what your portfolio is our belief is really simple have that type of approach so that everything that comes out of the funnel right that is your portfolio has all gone through the same process those companies in their stocks are going to act perform act similarly perform similarly under different environments that's not going to lead to consistent results when you're building your portfolio right your retirement plans you have different managers you have a large tab growth manager you have a large tab value manager have small cap managers you have international managers why do you do that you do it so when you blend them together they complement one another and they give you the most consistent results with the least amount of risk possible that's what we do we just simply apply that process to our universe and large capap grow so what does no preferred habitat mean it means that our portfolio is always comprised of what we believe to be different complimentary types of companies by Design they're different from one another we don't want them to all look and act and perform the same way at the same time so you can see the three little shaded boxes the first box are bucket that's a sophisticated word we came up with in Minneapolis 32 years ago the first bucket of our portfolio was consistent growth these are companies that are very often or typically nationally if not globally well established business models that have withstood the test of time they grow at a rate faster than the market as a whole and they do so more consistently than the market as a whole so think of companies like Microsoft and Technology they companies like United Health Group Minneapolis based company in the healthare sector think of Visa Mastercard the electronic payment business they're all examples of consistent growth companies we've owned them at one point in time we own the majority of them today we don't own these we do MasterCard but they're kind of a foundation of our portfolio but big dominant steady Ed companies if you just invest in them eventually you're going to get an environment where the market likes something else so you can't just stop there so we then move on to Dynamic growth Dynamic growth companies as a title is to J are dynamic in nature they're growing like crazy they're disrupting their Marketplace they're truly the greatest growth companies in the world think of how Amazon has changed retail right think of how Airbnb has disrupting the hotel industry think of how PayPal right an example ofon payments business has changed Visa MasterCards business model Dynamic growth are the greatest growth companies in the world the peak of their grow but there's a downside to that which is when they work they can be wonderful when they don't work they can be really volatile so I bet everyone sitting at this table is a subscriber to Netflix am I wrong you're not all right we're batting 95% very few companies have changed their business on a global basis the way Netflix but when Netflix as a company reports its earnings every quar the whole world is focused on one thing and one thing alone which is what how many new subscribers did we have in the last quarter if Netflix beats that number the stock do great Netflix misses that number by that much the stock gets hmer now over the long Arc of Time Netflix has done exceptionally well at meeting and exceeding those numbers but but along the path it's been up down up down right it's been really volatile so our view at Dynamic growth is really simple we're a growth manager of course we're to invest in the greatest growth companies in the world but sometimes a little bit goes a long way sometimes right be careful what you ask for have any of you ever heard of Cathy wood and runs the art Innovation fund her whole portfolio is dynamic growth and I bet everyone wanted to be invested in it in 2020 when it was up 110 plus% it's a great investment but most people didn't buy it before that they bought it after that because of these up 110% what happened the very next year lost half she was down close to 70% that's a roller coaster I don't know as I get older near retirement I don't like roller coaster any right I don't have the stomach that I used to have at one point so while it's always represented in our portfolio it will never be the entire portfolio it would always just be the last piece of the portfolio is cyclical growth if you think of cyclical growth that's we Define it it's the exact opposite of consistent grow instead of companies that grow the market with greater consistency these companies for the most part grow below the market with less consistency in a fancy way of saying less consistent is cyclical so there are certain segments of the market that are cyclical by major right energy companies are really Cal Financial companies are really Cal think of 2007 before the great financial crisis right the global economies of the world doing wonderfully well I mean you could it was investment in Nana you could throw a dog everything you hit was going to provide a double digit return the oil industry was doing wonderfully because oil was at $140 a barrel 12 months later oil was at $40 a barel if you're Exon Mobile what changed about your business other than the price of the product you you have the drilling right you can get the oil out of the ground you can refine it you can ship so if you think of a cylic right and you buy them at or near the bottom of the cycle as the cycle turns up these companies become very growthy and they can St that way for years at a time so it's not a typical Growth Company and I'll give you my favorite example Union Pacific Railroad the last time anyone in my business described a railroad as a growth industry Abraham Lincoln sat right hasn't been a growth industry for 150 years it's the perfect cylic when economy slowing down shipping slows down Trucking slows down railroads slow down when things start to pick up you participate in that upturn in Union Pacific you own one of two railroads who basically control that's why we love business model so when you look at our portfolio all day every day we always own all three people we will never own just one that's what no but in order to make this work you have to have flexibility you have to be able to adjust and adapt to the environment in which you are living in right now we don't want to underperform effort for our clients but I will tell you the thing we absolutely will not accept is underperforming for a prolonged period of time and coming to you and doing client and saying remember what I told you last quarter why we underperformed for that quarter that's the same thing this quarter that is totally unacceptable you as an investor have to adapt to the environment yourself right now you have to be able to do that all the time so at this approach we give ourselves flexibility we will never just be a third a third a third we give ourselves the ability to lean into as we say and enhance or own a little bit more of anyone type of these growth companies when that's what the market is fa so think of this very simply and think of the three different pockets of our portfolio when you get into the great financial crisis and everybody wants to play defense what part of our portfolio provides that the consistent steady eggs right when the market likes risk like it did in calar year 2020 what part of the portfolio do you think is going to perform best Dynamic if the econom slowing down you want less cycal exposure if the econom up want more cyclical exposure so we give ourselves the flexibility to shift the mix so to speak to change the profile of the portfolio to adapt to the environment in which we're investing in today our results over time if you go to the next page there's two charts here the chart of the right shows our roll 5year return versus the S&P 500 that dark is the 5e average annual return the S&P 500 so it starts with the worst 5year period in the lower left hand corner of that dark line and then you go up into the right that's five period those circles that you see are our portfolio performance on both a gross of fee and N ofe basis so the light shaded is the gross the dark sh as the what you see is really simple we've consistently added value and outperform the market we've done so in the lower left hand corner when things are bad we've done so in the middle when things are kind of normal then we've done so in the upper right corner which is when the market is honestly ripping that's the S&P 500 as a growth manager our clients often obviously compare us to a growth index so the Russell 1000 growth index is a CH of the left think you can see the same types of characteristics we add our most value when things are bad we consistently add value when things are normal and if the worst thing you can say about us is the upper right hand corner when the Market's ripping you haven't helped perform the market by a and our argument would be when the Market's ripping all you have to do is participate you just simply you should be happy to keep Pace with the market but that's not the environment where you try and take a lot more risk to maybe add that much more incremental return I worked for many many years with a a gentleman who's from Iowa he was a large Scout growth manager and he had an old saying he said in the investment World Bulls make money Bears make money pigs eventually get slaughtered don't be a pig giving you 25 take 25 don't try and take a lot of additional risk in your portfolio to get 27 that's not a very compelling tradeoff so again that's the worst you can say about winds low Capital I'm perfectly content with that being our Ste you'll turn to the next page I'm going to close with our results and I'm going to give you something to remember our results from a pure investment standpoint on the left hand side it shows we rank in the 24% we're in the top out of all the managers who do what we do was more than 1200 firms that have track records Beyond 10 years business so it's a very competitive to be in the top four TI are strong results but what's more compelling is the little chart on the right which shows the RIS return information ratio is a fancy statistic but I'll tell you what it shows it shows the consistency and predictability of value as a if you roll a dice in you're really right one year and really wrong the next you're going to have a horrible information ratio if you're very consistent and again back in my Baseball analy hit lots of signal bunch of dou triple or home run you're going to have a high information Rao our information ratio ranks in 8% meaning we do what we do generating excess results more consistently than 9% of firms who've done what we've done and this goes back over the last 25 years so as our founder Clark wio used to say I was born to do this just to remember wind slow slow deliver your results consistent allow your plan participants to own invest in and maintain their ownership in these great growth companies and the results that come with it but if you're providing them a roller coaster ride right like Cy at AR and you're in the top 2% when you're right you're in the bottom 2% when you're wrong like most roller coaster rides for retire they're going to say I'm right I've had enough and they're going to make bad investment decisions based on emotion that's really real right suffering a 75% loss is really painful but I'll put it another almost all the assets of our re 100% of our institutional business where organizations have $25 million minimums invest with us every one of them is a retir we go to work every day realizing we run the biggest piece of every of our CLI portfolios so we make a mistake it can be right we can really destroy the financial wellbe our if they're nearing retirement or in retirement they may never recover from that so that's why we focus on consistency that's why we focus on the Wind slow approach right question can you talk to us about the consistency and predictability of your management Cas sure um we run our strategy and like many manag operate in a multitude of different vehicles that you can access I think for your particular plan the most attractive um vehicle fee is what's called a collective TR the CIT and it's a 35 B 0.35% we have mutual funds obviously that have lower minimums and aren't for organizations such as yourself Fe higher um that CIT is actually the lowest price structure we have as organization you want to go higher we have a separate account 60 bases but it's a separate account so it's again really appreciate the opportunity to visit with you we would be honed should you and I get to come back to Jacksonville Beach and I highly recommend you schedule all your update meetings in January or February or July it's fine thank you thank youbody to roll or do we need a quick recess that we'd rather be dressed like you but we want to try to make a good impression um thanks for your time uh thank you to both the board and to Mariner for for the opportunity to present to you today uh intros my name is Terence fennessy I'm a Director of Business Development at clearbridge with me is v m Carney V is a client portfolio manager at the firm he's got over 30 years of experience and on this particular strategy the large kep growth strategy he's got 25 plus years of experience so we're host of host of experience to run through this strategy I promise you we will keep you schedule if not ahead if not ahead of schedule um and if Brandon needs to give us a the way flag at some point that's fine but ideally you won't have to uh a quick comment on partnership and it's kind of our firm firm DN uh we think partnership is critically important with our clients clearly we want to partner with you deliver exceptional investment results and help you achieve your investment goals but as importantly we want to help you with your mission here in florid we been awfully active with fppa I may have met some of you at fpta events and we think that's really important so I think that that that combination of investment performance and supporting our clients is it's it's a it's a good combination in terms of the strategy and I'll just highlight it before I turn it over to V to run through it one we're delivering a resilient large cap growth strategy it has diversification we invest in different types of growth companies it is concentrated we own 40 to 50 names we've got a laser focus on risk management so this is an all weather portfolio so a portfolio that should do well for you regardless of the market environment we think that's important because the last thing you want to do is be trading in and out of managers over the years you'd like to hire a manager that you know and trust and deliver good good long-term performs let me stop there any questions for me before B focuses on the highlights of the strategy and we want to make it interactive so if you have questions by all means just raise your hand all right thanks everybody um in advance Happy Thanksgiving to everybody hope everybody has a joyous holiday season so um on page two I think the value proposition that uh the teren talked about I just want to highlight what we try to offer clients we try to strike this balance of being purposefully different where we think we have an advantage relative to the marketplace if you open your book uh to page two while being relatively risk aware risk awareness to us is the type of stocks that we buy when we buy them how we size the positions and how we put it all together think of like a great chef and how you mix those ingredients together that's really what we we're going to offer you in our solution is somebody who thinks about being purposely different where we're trying to separate fad from Trend we've owned some businesses in this portfolio for over 25 years continuously and we think the adantage like in a pension plan is around the compounding of that wealth not in kind of trading around so that's really the value proposition what I hope to articulate in these next 10 to 15 minutes is how we're purposely different how we're risk aware so if you go to page three and kind of you have it nicely open the team right if we're you know you're representing both the general employees the the fire and the police and we always think about a team and knowing each each other's roles so if you look at the threers team in addition to the um 16 research analysts that we have at the firm that support the strategy we always say each person brings a unique skill set to Bear to help us generate the strong results so in the middle is is Margaret vrono um I knew her when she was Margaret blades before uh she had was married and had kids and so um she's like our chief operating officer the chief administrative officer that says where are we on the agenda what are the three next ideas that we're working with how are we thinking about working with the analyst on the comt questions for this so really thinking about how do we administer the strategy really well dayto day and then you have different skill sets Peter to me is like a glass half full half empty person always thinking about the downside risk he's the most skeptical growth manager you'll ever meet in your life and then you have Erica FF Faro who is like a great Optimist and thinking about the imaginative open-ended areas of road so really to us the idea of each person having their role and bringing that together um to to generate the human capital decisions is really important um I'm going to go into the three parts that I think make this purposely different I'm going to I'm going to ask you to turn to page six of the presentation um and this is where I think what what really differentiates us is you'll see a lot of other managers that start with what's the growth rate what's the uh valuation we start with business model first so these three building blocks that you'll see above me you really think about it is this a good industry and is this a in company within that industry that's really the framework to start with the second key pillar is to think about the financial structure is it a conservatively financed company how are they going to grow and all things being equal we want them to finance that with their own cash flow and not have to go to the equity markets or try to raise Capital through debt offerings over and over again so very conservatively financed and then this third pillar of management analysis much like you're asking us to come today and and present to you we really it's really important to look in the eyes of the management teams that we're going to entrust our Capital with and not just have them understand when things will go well but when things will go less well and really thinking about that Clarity Vision Margaret has taught me over the years that if a company management team can articulate to me what their mission is they'll be able to articulate it to every employee of the firm and they'll be able to execute on that mission very clearly so to me those once we've answered that question is is this a good business that we could own through a cycle then the question is what do we want to pay for it and valuation is really kept for last because we don't want to be seduced by Cheap valuation or expensive valuation we really want to start with is this a good business that we can own for multiple years so that's really the first way we're purposely different we kind of flip the problem if you turn the page you can see there on page seven the next way that we're very different than our peers is instead of saying we're going to be a high growth manager or a conservative growth manager these three key areas what we call a spectrum of grow is really how we execute ons say what what Teran said before how can we become an all- weather strategy one of our Florida pension clients um that I've had the pleasure to work with over the last decade said instead of predicting where the market is going we try to say what is the market giving us and where are the opportunities at that moment in time and so instead of saying this is where we think uh earnings are going to be or the econom is going to be let's just try to find the appropriate amount of balance between these 40 to 50 companies articulate what those three types of growth companies are um the always the the majority of the portfolio at least 50% is going to be in that middle area what I call stable names so you see United Healthcare and Visa as the type of names that you see within that part of the portfolio we owned United healthc Care since uh uh Obamacare was implemented in 2010 we bought Visa also in 2010 when people worried about would there be regulation of the kind of credit card companies and now we continuously own those companies for 15 years the second part of the portfolio is what we call these select names more higher growth names what people traditionally think of as gr names so we own Amazon in this portfolio we own Nvidia in this portfolio we own Tesla in this portfolio but the difference is we bought Amazon in 2004 when archaically the thing that they were disrupting was books borders in Barnes & Noble right now nobody if I if I tell my 18-year-old daughter there's a bar no doesn't even know what that is right but that was the first thing that they disrupted and the ability to take that to new areas of the market is what I did when we bought Nvidia we did it in 2018 when it sold off 50% when nobody talked about artificial intelligence and the idea was that people were worried about the durability of gaming RH and then with Tesla we bought it at the end of 22 when the stock corrected after 50 50% after M took over Twitter and so each of these type of things creates that opportunity and that's maybe way we're different is most compan most growth managers think about momentum we try to buy these companies when they're down because it gives us both the chance to participate in a long-term Trend and a short-term opportunity so that's how you should think about it so that's about a third of the portfolio and then the remaining part which really um is atypical for a lot of growth managers is it's called cyclical but I think of these as opportunistic things so you see Union Pacific there you see Target which we bought last year but to me the two best examples that we had we bought a company Chipotle in 2016 after they had their food scare issues they brought in a new CEO the new CEO of that company uh that CEO of that company Brian nickel was just named the CEO of Starbucks and we bought Starbucks actually uh three months ago on that announcement and the idea of taking a great brand that's a little bit um undermanaged and returning it to its its prior Glory that's how you should think of this part of the portfolio about 10 to 15% of the portfol so you mix these ingredients well and hopefully you'll have an all weather grow I'm going to kind of close with two kind of key areas page nine and page 14 so page nine to me is really important because it's important um if we're fortunate enough to be selected to manage assets for your plan that you understand when we'll do well and like any manager there will be periods where we don't do as well so if you go to page nine it's it has the slide of how oh I'm sorry page 10 I apologize when you memorize everything uh you sometimes make mistakes so uh so on page 10 the um we've traditionally done very well in kind of moderate growth environments and especially declining markets right we call it kind of win by not losing so if you look on this page if you look at the past periods when we've been down by more than the market has corrected by more than 8% we've outperformed in all but one of those periods including this period in June and July of this year where we actually created 400 basis points 4% of excess performance for our clients so we think because we've thought about the durability of these businesses and not so much about the valuation we can really have that kind of anchor when the market sells off people don't worry about that as much when the markets are up 20 25% but those inevitably happen and we keep people kind of invested during those time periods so I think setting the expectation of that's the best time for this strategy a moderate growth environment kind of single digit to 15% plus uh uh market returns should be really good for the strategy usually when the Market's up more than 25% because we cap that high growth portion of the portfolio at about a third is when we're going to struggle and so that I think sets up performance activity the Market's up a lot we'll probably be in line to be behind just by a little bit but when we're really going to do well is those kind of more choppy markets so that was uh one page if you go to maybe page 14 that would be the my my kind of closing um statement closing view to is let's look forward and so I think where I would uh ask you to look is in that kind of middle part of the portfolio so many growth managers own all the same stocks but if you look at the middle part of the portfolio our waiting within that kind of next generation of growth companies which is in what they call 50 billion to 250 billion so not the nvidias not the Amazon that next generation of companies we have almost twice the weight of the Benchmark so we don't look like The Benchmark and we can be different but I think that positioning on ground what are the next growth companies that are going to happen and you're starting to see this happen really since the end of June where the market has broen out and that should be a real asset for our strategy and then on the right side if you look at our the waiting in the U uh on on page 14 on the left on the right side if you look at our position I would challenge you to find another growth manager who has done as well as we have over the last couple of years when we're this underweight Information Technology when all the um all the headlines in the market have about they call the Magnificent 7 these kind of big big cap tech stocks um and we've been able to hold our own that if the market broadens Beyond kind of Technology as a as an area of Market leadership we should be able to do really really well so um Terence did you have any closing com I I do but let me pause there in case there are any questions for us um page 15 are all those S&P 500 I don't know about H Alco or sales force yeah sure uh when you say so now our Benchmark is the Russell 1,000 bro these are large cap companies but like Palo Alto that's kind of that Daniel that's a great indication of that next generation of companies right so Palo Alto is a security company with everything that's happening around cyber security they've had among the best um products in the market a blade uh product that is a market leading um technology in cyber security so that's a that's a name that we've owned probably for the since 2016 and then Salesforce is a name that most people are aware of it's kind of a web based software often for the Enterprise or like um people in the financial services or other industries of how they segment and Target and service their client base and um we've owned that company now for five six years so that's a type of company those are both S&P 500 companies but our waiting in the portfolio is significantly higher than that that's in the Benchmark yeah go ahead I know you you around yourself this question Nvidia which I love you've got it at 10% and I know they three of their largest customers are endeavoring to be their competitor yes you know that oh yes you're 10% of your y so what your thoughts on yeah so um that's a very good observation on your part and we've actually trimmed that position by over 300 basis points in the last 18 months because um there's probably never been a company of this scale that's grown its revenues by 100% like they did in 2023 two competitors around here customers their biggest customers just to give everybody part it's Amazon it's Microsoft it's Google right alphabet and so all of these companies are trying to figure out can they create their own chips now our analysis around that is that while they're trying to create their own chips it's for specific use cases whereas Nvidia is a platform that can be used by almost anybody we would agre that Nvidia right now so this is the challenge I think for any growth manager especially in large growth you look at that position and say oh my gosh it's 10% but it's actually a lower weight than is in The Benchmark if you can believe that so we've actually if if if we hadn't trimmed any of nid we' probably own 14 15% um but we have actually been cognizant about the risk and we we've been putting it into other semiconductor names look at other softw names that was where Salesforce comes into play those that's how we can trying uh the biggest companies are truly um it's like the 1870s right like they have enormous power and they're trying to understand how broad that can be but to your point there's going to be a point where valuation or they're competing against each other what has happened over the last few years is they've all kind of done well we're we believe we're in a market only a few of them well and picking which ones will do well and which ones won't will differentiate you know who does well for your plan Pacific did that long time Union Pacific that right your management on page 20el so we're recommending a CIT share class at 40 basis points another thing I would add in terms of working with us Brandon knows this we're transparent so if we're fortunate enough to be hired and be your partner if there are questions the board has during a quarter you know what are we buying what are we thinking we share that information so you should never feel like you got to wait till the end of the quarter to get an update what's our portfolio doing what are we thinking we're highly transparent with our clients and we really encourage our clients to ask us questions and we provide feedback so I just want you to know we we truly value those conversations ongoing conversations we have and should we be Fort enough to be hired then a and I would be the ones supporting supporting this this account anything else not to say it's but if they were interested in a separate account didn't want the C for some they can do that separ separate account think yeah your I I would say that that's a good Brandon we've always said that um Our intention is to manage the strategy the vehicle that you choose whether that's a separate account whether that's a c CIT whatever you choose is best for your plan you should let us know we'll make sure it happens all right other questions from anybody on the boards thank you for the weather got just come for the weather yeah I we're doing this the answer is no but to have the thanks so much all right before I jump anying like to discuss so I pulled up the to help refresh my m a little bit proba the bottom Hardin we talk I'm looking at ranking from year one through year seems always be higher higher R correct why is I think explain that before well there there's a lot of different reasons I what I'll I'll just s it down into a very simple one the last 10 years growth and I'm just looking at the index right now last 10 years the index has down over 16% when you compare Windslow and clear bridge to each other probably heard a lot of similarities in the presentation but there's a little bit of nuance difference essentially Windslow has on average a higher component of those sort of what they call Dynamic names riskier growth names it's a higher percentage so in a 10-year period where the index did 16% they're giving you a bit more upside because they have a higher portion of those kind of riskier growth names where clearbridge on average tends to have a little less of those so I think that's that that again there are a lot of similarities but I think that's the primary difference um just to put that into into numbers if you flip ahead to page number 10 which is essentially the last page of that short book a lot of numbers on this page I'm really only going to focus on two lines so let's use the the 10 year which is on the bottom half of page number 10 the third line down says stddev standard deviation okay that's the height of the roller coaster in percentage terms performance how much is it going up and down if you had a per you know standard deviation of zero you know your performance would just be a straight line it would never deviate right if you've got a standard deviation of a 100 that means you have a huge upside and a huge downside and then OB so the Lesser that number the more stable the ride the lower the highs and the lower the lows so what you'll notice is clear bridge is 17% winds low at 17.9 not dramatically different but a little more volatile a little more up and down and that also correlates to the next number immediately below that which is beta that's the measure of Market risk you see uh clear bridge at 98 winds low at 102 if you go up to the top half of the page that's looking on the trailing sevene the numbers are slightly different but the relationship is the same when clear Bridge has a little bit lower standard deviation little bit lower Beta And so again I take it back to in a 10year period where you've got you know double digit returns having a little more beta having a little more risk in the portfolio gives you a little better return so then the question becom a go forward basis again I think both do well but but Apple to Apple clear Bridge does a probably a little bit better the more challenged the market is and the more the the market is neutral to positive you know winds probably do a little bit better any other questions thoughts on what You' heard again both very good managers like I said both I think very competitive the standard of the standard fee for large cap growth is count of between four excuse me 50 and 60 basis points um so both are are really at the kind of the low end of that range 35 basis points and it just so you understood or if you don't understand winds offering a CIT Collective Investment Trust which is a pooled vehicle similar to a mutual fund but technically a little different but that is a vehicle that that can be purchased inside or at your custodial firm so some cits you actually contract Direct with the provider and then you you kind of send the money to them and you have an account there with them and then if you need money back you you have it wired back to your custodial Bank Salem trust this particular version of the CIT you actually have Salem trust and buy it within your account so it will reside if you will at Salem trust and is held there like a mutual fun um just for comparison the excuse me separ have with all spring that is also at Salem trust but that is a specific designated account that all spring is buying and selling securities on your behalf so when they also they each mention separate account you could have that same type of relationship with wins low is more expensive so kind of doesn't make sense to do that um with uh with clearbridge they'll they're offering the same fee for either vehicle um so from that standpoint you just have the the flexibility to to choose between the two with my brain speaking out loud I like the fact that c Bridge can do better in a more volatile Market um although there's a benefit to wind flow and their and their performance on the high end even there's a higher risk the question I guess would that I would have is what is the likelihood or viability if we would declare brid and said sure we like everything you have but what about a uh versus 40 let's make it competitive um I can certainly ask I I will tell you that both of these firms along with with another were involved with another similar presentation just a few weeks ago they weren't even offering 40 at that point discussion since then because the fee was such a difference that they came back and they they said we can go to 40 but and they understood that WIS low would have a fee of 35 so I I can't say they won't do it but I would guess at this point that that 40 is probably the the best but again I'm happy to ask if if that's a consideration the only other the the thing that I would draw out there Fe differences are meaningful but when you look out over five or 10 years that five basis point difference is pretty small relative to what you tend to see in performance difference you know do better than the other they're going to do so by half a percent three4 of a percent you know far more than than that five basis CL difference so I'm opposite of Dan when you said about the the murky Waters and they doing better my point is like if we're in the ability to make more money I would rather have the ability to make more money at that time rather than when we're looking at a downward market and it's trading downwards to lose less so I see both points of it but at the same time I don't want to have a company that doesn't and he even made a point to say they don't look for looking forward or they don't look forward they're looking at what the market makes their money now to me they're not looking it's a weird statement that say they're not looking forward to see what's going to happen with the market I I agree with you um that's why I was trying to push clear bridge to 35 at 35 basic basic points then maybe we're we're in Arena if not then I I said go back to Winslow page five to picky back on what Jason said if we're looking at their chart to pick a manager because their downside if you draw a line over from the zero rate of return you pick up maybe one1 of the uh incidents where there's a negative return and I don't think we should pick a manager based on better performance on 110 I'd rather be looking at at the 910 the it's not any of and and I'm not even sure if you were on the committee at the time when we selected JP Morgan for a large C value strategy that one is a little bit more defensive oriented so just as a as a 10,000 foot thing if we have a little more defensive position on the value side maybe there's an argument for having a little more aggressive on the growth side so the two complement each other as opposed to having sort of a little more defensive on either side because then again you get the sort of the higher or the higher running market then then both are likely to to be a little bit more behind as opposed to one being ahead and one behind and again I'm I'm speaking all in relative terms of course both yeah although interesting not just of late the last couple of months all spring has actually done incredibly well which is is fantastic it's perfect for making it back right just you won't see we'll get to this up % October all well done I told you looking forward cryst ball yeah but again it's it's less you know going back to the all spring the recommendation it had to do with the the change in Personnel the retirement of theam the fact that they took essentially two different firms and kind of glued them together sort of Let Go part of this team Let Go part of this team and we're trying to merge the remaining folks and there's just going to be some that that was really the basis for the recommendation although performance Circle was been challenge that was the the reason kind of instability of the of the team in process we clear bridge out of I like the on page Four Winds does seem to be and you know the the two companies not surprisingly had almost the same philosophy but I did like the the concept of you know they they got particular firms in their portfolio and they're shifting you know shares back and forth depending on when one's down so it looks like it might be grow coming up just seem to go more proactive and I think uh we have personally I'd rather we were more conservative over the next few years just because you know the risks to global economy are are something that nobody has any idea you know what's going to happen and you know it's not our money that we're managing so care Mone no I make contributions into it so if you'll see these members that take money out it is the members money now the city does make a contribution and the city is the backer of the pension fund however as a representative it is the memb it is a portion of the member's money I appreciate that but if we lose uh the city has to make it good correct 100% sounds like we've got a few on both sides some some so this is Bible right you got a got a single account of alling that essentially kind of has a representative interest in and similarly if you were to to move you have the same type of relationship yeah the only reason why I would consider they Dro Bas Point SS to me like I mean again I'm happy to step out and and and try to call Terrence and ask the question so that's but I would say that the majority thinking a stra i discussion talk about motion a second and discussion I need a motion from each Bo from each board I'll kick it off I make a motion for the police board to sell the allr portfolio that's a strong word I like it the allr portfolio and hire officially discuss and I'll say that I think like Dan i' go with either one if there's strong feelings among others that favor it's a very very marginal thing the only way I'm going with CLE is if they're dropping so let justar additional customization so in a collective vehicle you are one investor among many and and well not just as the as the plan but your assets would be commingled with 20 30 40 other pension plans and other investors Oh I thought no so so then so they have they have essentially a master like agreement or find that how they have to manage that account now the way they do that is the same process and strategy as If you hired them in a separate account and they would effectively mirror each other with the caveat in a separate account and a direct contract that you have with the manager you have the ability via your IPS to just and I'm gonna make something up we're we do not want you to buy Exxon Mobile for whatever reason and in a separate account you could prohibit certain individual things where in a commingled vehicle they have to treat you the same as everyone else so they can't make those specific Provisions or or that normal it was yeah no so it it it it often has to do with one fee difference and to the hassle of of How It's custody or where how it's transacted through so if you were regularly needing cash flow and it was going to be held at I'm just you know many times a CIT will be custody at State Street or US Bank it's not a um you know one of the the larger banking institutions where your actual pension assets are at Salem trust so you had back and forth between this Windslow account and and it was custody somewhere else you have to then get it wire there's a day in transit for it to land there's more there's more aspects administrative hassle so sometimes having it in a separate account at your custodian some Simplicity from an audit standpoint and the like now this particular CIT that we're talking about actually would be held in the custodial accounts that is not an issue any other any other questions comments discussion otherwise think we're up for the official vote Nick Curry yes Dan Jansen yes Brandon marisma yes Jennifer Rell yes David coill yes John Patrick yes Matthew gry yes Jason Shar yes George Candler yes Ed Dawson yes John McDaniel yes Lance hsh yes ddy white yes motion passes just just for General understanding there's an application technically that we do which is slightly different so we'll get that application process underway once that's complete then we actually do a formal instruction foration of the there any benefit to engaging a transition manager for the sell or I'm sorry termination of no and the reason being you typically when you're doing transition you're going from a portfolio of Securities into another portfolio of Securities and you don't want to be you know selling shares of Apple just to repurchase it once it lands in the other but in a CIT it's a little more cumbersome to try to move sec that so that comp portfolio andarge there's a lot less small portfolio you recall what the number was we were at dollars as of this morning which I'm sure is what you were asking uh 20,1 166,000 up from 18.4 as of September 30th so we good to jump into the the regular quarterly part of the presentation okay so actually did not print you a hard copy of this but up on the screen I most of you have seen this before it's just a an update at the S&P 500 going back to thee um GFC highs in 2007 and what you got shaded in red or orange or any periods where the S&P dropped 5% or more and obviously what we're trying to illustrate here certainly the power of investing over time is certainly markets move higher even though you have a 55% drop here you have a 133% drop here you have a 33% drop there you have these significant bumps along the road but you stay invested Al the market continues to move higher um the second part of that um and I think is really interesting probably more interesting than the front so that the chart on the front represents just over 17 years worth of of trading history okay and over that period the S&P averaged 10.02% of those 17 years if you somehow could have been out of the market for just the 20 worst days so a total of four weeks that those markets have those the worst few handful of days you would take your return up to 19.6% if you if you somehow knew exactly how that was going to happen now conversely if you're the opposite in terms of bad luck and you are out of the market for the 20 best days out of 17 years you take your 10% 2% now I only am familiar with that's been able to kind of consistently sort of avoid all those down down markets their name was birning off in jet you know no one no one knows when those days are going to come you know and so the message I was like to say this the beauty of the pension fund having a 50 to 100e life we're not trying to invest for a retirement tomorrow or next year we have a long Horizon with lots of participants lots of beneficiaries so we stay invest you rebalance as necessary and so you make sure you're in for all those good and bad days and you get that 10% you don't accidentally turn your 10% into 2% because you say hey tomorrow we think tomorrow is going to be a bad day so let's get out and then it winds up you know being being a good day and you miss out so now go ahead and jump into the main part of the quarterly report you've got the hard copy in front of you that's EAS look through I'm just going to hit a few pages really quickly U page number four I'm in the I'm just going to focus on the bottom right hand corner of page number four this looks at the year that is our fiscal year end September 30th so in dark blue you've got the S&P 500 was up 36.5% small cap stocks as measured by the Russell 2000 were up 26.8% the international stocks depending on the Benchmark were up about 25% and then in red down at the bottom the Bloomberg us a is up 11.6% so if you think about these are the main food groups if you will that that we do our investing and the worst performer was up 11.6% so just as a general backdrop this is going to be a pretty good year I'm going skip ahead to page number 10 I'm sorry 11 down in the bottom right hand corner this is the treasury yield curve so what this looks at is each yield level for all of the different treasury Securities from the from the one month all the way up to the 30e the Blue Line represents where we were at September 30th and the other lines represent that the prior three months then the three months before that and the months before the yellow or orange line is where we were at June 30th and what you'll notice is a significant decline on that page so what we have is a significant drop in interest rates within the qut now part of that was the FED actually cutting rates in September but most of that move was actually even done ahead that's the market kind of anticipating one that the Fed was going to cut but also that inflation although still elevated is a lot lower than it had been say year you know a year ago when we're over 9% we're down closer to 3% given the you know On Any Given month and the year-over-year look so inflation is coming down certainly aspects of the economy are slowing and so yields uh began to decline bond prices move opposite of interest rates so I mentioned earlier the 11 plus percent out of fixed income this is why you saw this big drop in interest rates so your bond prices shot up in value as they as they did come down any questions on kind of General market commentary if not let's take you to page number 14 can go by this chart without reviewing it this takes us back our we have your history going all the way back to 1987 when you were sitting at under $12 million as a reminder those blue bars along the bottom presentent your net cash flow so any money that comes into the plan whether it be by active employees making their their contributions the city Andor State funds or the the 175 185 monies come in minus everything that comes out in terms of expenses and benefit payments so what you'll notice is obviously over that period we've spent all of that 11.8 million plus an additional almost 39 million so you're you're I would argue significantly cash flow Right In terms you're paying way more out than you're bringing in however your market value the end of september1 127.5 million we also include that red line which is the theoretical assumed rate of return so if you just invested those assets and those cash flows into a theoretical investment that was earning your assumed rate of return you'd be at 8.1 million so you've outperformed your assumed rate of return collectively over period um you know by roughly $19 million how that assumtion set that is set by the board um so on an annual basis your actuary comes in to provide your valuation um and then along with that will be a recommendation if any adjustments are are warranted or or suggested and then the boards um make that decision so we we report on it but it's just a reflection of what has been you know approved aside the if I'm not mistaken that would be your next meeting May meeting you'll have the valuation which will essentially take the information from this book and memorialize that and put it into the the next valuation which then sets funding for the the city and so on for have to get too into it but the the funding period that begins on October 1st of 2025 um so let's skip ahead to page 17 sticking with the the asset allocation I like do 17 because it shows the deviations from our targets again if the number is off to the right it means we are overweight our Target if it's to the left we're underweight and generally speaking we're relatively narrow in that range we're about 3.1% over in domestic Equity half a percent over in international little bit under in fixed income both in domestic and Global but that of course is offset by the cash position you see we don't actually Target cash but we have about 1.8 million so again at at taking the picture of September 30th we actually looked fairly good U you know there would be no need for rebalancing as of today instead of being you know 3.6% overweight Equity we're now at 5 and a qu% overweight to equity beyond the 65% threshold which is the limit um per the so we might want to take at least a moderate action there just to to dial that back in but we can kind of come back to that after we look at all the numbers if that's okay all right one thing that I'm going to do just a little different is I'm GNA actually take you um I'm work backwards in the report so if you go to page number 23 I'm going to look at the components and kind of work work my way back up so page 23 this is the one thing that actually went down in the year real estate uh we have the JP Morgan strategic property fund was positive for the quarter 82 basis points versus .13 for the index but you'll notice the year -10 A5 versus 7.75 as they did uh underperform kind of the short version is they have more office within that portfolio than than most of their peers with index which accounts for a good good under performance while I'm talking about JP Morgan just recently our uh research team kind of similarly to to the discussion we just had on all spring this goes back to a number of months um is making the recommendation to clients in the Strategic property fund to move on um they have have had some changes to their team additionally um they like a lot of their we track there's about 15 of the Odyssey managers that we regularly track and interact with um not surprisingly over the last couple of years most have said you know we're going to try to minimize office we're going to you know there a lot of question marks and concerns and so they have plans to kind of move away minimize that exposure and do other things but JP Morgan really had they had these plans and haven't executed on them it kind of just kind of stayed where they are so one some changes in the team and and two just not really following plan that they've set out as has led our team to say we think there there's probably better options within the real estate space so we are recommending um that you essentially put in for Redemption from that fund um understanding that those markets are are kind of locked up at the moment so it will take a little while to get that money out of the of the portfolio of the account um and so the it's a long way ofing I would come in and maybe come with ideas for for where to put that money but it's going to take multiple quarters to really start to get that money out so we don't have to make that decision today I will come back to you at subsequent meetings to to review that we did need to pile on at this particular I happy to stop and take questions on sort that suggestion or recommendation really I think I asked may we already been really far back in line back in for Redemption right yeah it it is it is a very slow process now not just for jpan but really all of their peers are what's ex also to take it you have to back up just a couple of years ago in 2022 our equity and our fixed income portfolios were down double digits our real estate portfolio is up over 20% and so what happened after the end of that year we were over you like almost everyone else were overweight real estate because it was up while everything else was down so a lot of folks put in for a Redemption request all the while interest rates are starting to to hike up and really the the commercial real estate markets kind of ground to Halt there's been very little transaction activity um so you can't just push a button and sell a building or or what have you so that's why these cues have gone up and they've been very slow to redeem funds now many of those redemptions if they were for rebalancing purposes been been released or partially released because Equity markets are back up real estate's down and a lot of those positions have kind of right siiz themselves as as is the case for us but with that said those Redemption cues are still in place because of the lack of liquidity within the portfolio now that we've seen two cuts from the FED there's some optimism that they're going to get back to a more liquid environment where where transactions are occurring so hopefully the pace of those redemptions speeds up but we haven't seen that to date now when you put in for the Redemption is this recover in all at once or is it it's as they have liquidity so theoretically right if if they um could push a button and and get good prices for half the properties in the portfolio that they no longer wanted and they were flushed with cash enough to all the redemptions then it could come all of us now it's only done quarterly so if you put it in now I think you'd be in a position for um like Janu it's January 30 so essentially like you put it in for for the end of of the quarter end of the year and then 30 days after that I think is when they P actual make distribution um my my guess is that for the exact dollar amount I it's 6 52 5.2 my best guess is you get about $500,000 in January sweet unless the pace picks up between where where it has been and and ultimately make that distribution hopefully as we go through next year maybe the next quarter after that it's larger and larger and it moves through faster but but my guess is you still have at least some kind of I mean like I said I brought it up in May that I felt this was and based on what you've been telling us is this has been wul underperforming comparative to its peers correct it has struggled with office I think that was part of the frustration is you know plan that hey we know we overweight office we're going to be changing that we're going to be shifting more to multi family to Industrial as we continue to watch it it's not happening which again becomes a sort of frustration though and say well we've got all these other firms that have kind of set out a similar game plan to say look the dynamic in office has changed with Co and everything else so we're not going to sit here at 40% and they go from you know 40 to 35 to 25% and strategically shift the portfolio and and one of the frustrations is JB Morgan with a similar sounding plan hasn't really been changing that allocation and that's that's the the bigger concern I would 6 months ago but I mean I make a motion to terminate is it terminate or redeem much softer um the JP Mor strategic property fund now my concern is if we let's just say do get the windfall 5.2 I would expect at the next meeting you have options for us to be able to um move that in so we don't find ourselves completely out of balance I I'll bring names next time but ultimately the point I saying is there's there's less time pressure as it some other liquid investment where you say get out you're not you're not waiting three months or Beyond to get out that is there any concern with what we'd be getting into because we may only get a half million I'm pretty sure um no big Bank wants our little weasly half million dollar um with the expectation that it would work up to that 5.2 i i d you're can get different answers from different firms but but they all understand the position and I think there will be some flexibility to to work fixed certain I mean in a r position yeah certainly and and again we're a few months at about quarters away from from that but just as an example let's say you know we're we're $5 million is roughly the allocation so if you recommitted to something else and my what I what I guessed was that they gave you 500,000 so your cash position goes to 2.3 million and then the next firm you know three months later calls they're probably not calling the entire amount maybe they call half you have essentially that amount sitting in cash in it so it could be a little bit of a kind of a give and take between the pacing of distributions and the calling of of new money um to to look at at funding that but that is a little bit of the challenge is is trying to time you don't know exactly how quickly new money will go in and you certainly don't know how quickly the old money's coming out you'd love to be able to just tie those together but yeah that that's my concern corre or or alternately what you could do potentially is you say okay we've got 5 million coming out but we're unsure of the timing so we'll commit to 3 million dollar on the new one first and see how it works out and then six months later 12 months later after you have a little more information say okay now we we have better clarity now we can add another two or million to that commitment and kind of balance those out cool right there's a motion on the table we got David cohill yes John patri yes Matthew gry yes Jason sh second George Hy yes Edson yes John McDaniel yes hsh yes Debbie White yes I nck Curry yes Dan Jansen yes Brandon maresma yes Jennifer R yes okay uh so getting back to to the report I'm actually going to go now up a page to page 22 um and kind of going in reverse order now we're going to get into fixed income and what you'll notice is a lot of relative outperformance so first is Pimco Diversified this is our Global uh portfolio for the year they were up 15.4% versus 11.02 for their index so not only did it it out perform C um had a very strong overall rate of return Then above that we have our two domestic um fixed income managers the be short-term fund was up 88.1% versus 7.2 and then saw grass 11.9 versus 11.1 so again relative out performance in what was a very strong year again when you think about that portfolio we started the year yielding earning about five maybe five and a quarter per so you got rough double that rate of return because those rates meaning Bonds were appreciated then as you move up to the top of page 22 we get into the three international strategies all performed in the the 20 plus per rate of return for the year which again in a normal year is a really nice return but when you compare that to certainly the domestic stocks they did underperform um although again collectively almost 24% out of that group of man for for the year now if you move back to page 21 the last of the the return pages but again I'm going to continue to go in this reverse order Eaton Vance that's our smid or small and midcap manager for the for the core excuse me for the year 3.01% versus 26.2% so very nice relative performance and again a a very strong year JP Morgan our value manager almost 25 % but that Benchmark was up over 27% that again that speaks to sort of that value defensiveness when the market is up pretty big they will tend to to lag behind just a little bit um but still a very nice rate of return all spring who we've been talking about again the last 12 months almost 48% beating the policy of 42.2% so nice that sort of outgoing you're getting some relative outperformance and a relative bump there which is obviously nice um and then the last piece is our Vanguard index fund 35 and a qu% for the year versus 3523 essentially tracking the index I mean output forming actually just by a fraction then take all of those numbers that we just talked about go up to the top for the quarter not that that really matters it's 6.31% versus 5.83 and you place number 11 in the universe you outperform for the three months to finish the year you performed 89% of public funds around the country most important number on the page is that second column fytd fiscal year to date and this is our year end number gross of fees 23.44% placing in the 23rd percentile better than more than 75% of public funds and you beat your policy a little bit which is up 23.24% net number we're talking about Brad your your actuary that's effectively what he's going to be using as part of that next valuation I want to put the just into a little bit of perspective here in 2021 we had a total plan net return of about 19% this 23.24% net is the best return in the last 25 years um maybe you match that in the late 90s but I even doubt it this probably is your best return easily within the last 40 years um so again want you to that's kind of what I want to sort of leave or close on is this this fantastic performance within the report um because it is it is really a fantastic year I mean I would think Brad do thatu um so then the only other item um that I wanted to to Circle back with after kind of talking about where everything was again I mentioned as of September 30th we were at $17.5 million today we're at $1 130.4 million and that's when our fixed income has actually declined a little bit because interest rates have moved slightly high in the last couple of months and our Equity portfolio has also gone up in value so now we are beyond that 65% threshold which is our ordinance maximum so from a a rebalancing kind of perspective we're only over the 65 threshold by by a few basis points so we're not over dramatically if we just wanted to get back under the 65 that would only take about a half a million dollar okay to get all the way back to our Target of 60% and give us a little or upside breathing room that would be $6.6 million in total um and effectively that would all come from domestic Equity with what's happened we were fractionally overweight as of September 30th to International with a larger overweight to domestic since then International has actually come down so we're fraction below Target and our domestic Equity has gone up by quite a bit as as I mentioned earlier the all portfolio up almost 10% just in the last two months so that's where the overweight has really risen or or come come from if we wanted to only say take half of that overweight back we're talking about $3.3 million so again in P in the past we've we've not necessarily been comfortable going all the way back to Target we've sometime taken some some moderate steps so that's why I want to throw out $3.3 million that gets us to about 62.5% in equity which is again half halfway between our to see us do just a rebalancing let's take that six and split it up maybe between International and domestic and let's get rebalanced with everything we did today dropping off all spring for for those that are in fine that that's in the last 12 months your equities are up 35% so taking some of those chips off the table if you will after such a nice run that that's you know the way to look at it and again you if you did that You' just be going back to Target not on but just just going back now I can safely assume that with the feding the last we could expect our domestic fix to not see double returns hopefully not um yeah I I think I think expecting that kind of return again in that rela in a short window is probably unlikely um but if the FED does continue to cut which is debated you know certainly GDP has remained elevated and there's some question about how much more they will cut um I would certainly expect those numbers to moderate but um even a if if you have a neutral interest rate environment you're still collecting that you know four and a half 5% type yields off of those at least the S portfolio portfolio shorter duration that not quite that levels but certainly a reasonable y as compared to what we were getting years ago but I heard you say earlier a lot of our returns were based on kind of dropping rates correct where the stuff that we had bought was value higher correct so in order to get another similar in r a similar kind of boost to Performance I think you need to see the economy really slow down and again that's why I say sort of that's sort of the bad news we've been able to get a nice drop in yields without sort of GDP and and destruction of the economy in order for another leg like that I think youd probably have to see a real deterioration in the economy which probably then negatively affects the equity portfolios and other parts of the of the I wouldn't expect fed do a whole lot in the next 50 days no I was just kind of resetting expectations quarter one and Quarter Two of next year what's the cap one um already there I mean no well for police and fire the max is 25% for international Assets Now that would combined with like the P Co fund but have Target and sort of an intermediate 5% C of so call it 15% is where we would sort of have the high size for the equity exposure but we're we're underweight by 1600s 16% International so you're underweight a few dollars but that's that's not unless we were potentially trying to overweight the position we would only get you know $100,000 or so to to 10% that would not be a significant Source or excuse me landing spot for now I noticed winds in presentation they do have some International I guess exposure ADR Securities or multinationals that I'm assuming that is 25 so if we had in our allocation built in 15 I saw winds could has that sort of 5% number we could essentially be bouncing pretty close on a on a big upswing of the international to that 25 so so that portfolio the large growth as it sits today before any rebalancing is a little over 15% okay so if 15% of your portfolio had 5% International now you're talking about a fairly small number that you're then adding on top so so realistically that is not a concern okay if you if you were to set your International Equity at 15 plus our PCO is another five giving to 20 now all of a sudden if those run a little bit and you've got a wind slow that's buying in now all of a sudden we're starting to get close but but we're a long way out where I would not be let's go back you said 6.6 takes us to back to our 60% Target for for total equ 50% in domestic 6.6 yeah what would you recommend it going to so the three Str well let's start with the three strategies coming out it would come out of the um well four potentially Vanguard Total stock market index you've got the all spring portfolio but let's just think of it as the large growth bucket here right the large growth bucket we've got the JP Morgan Equity income um and we also have the eaten Vance s cat portfolio but realistically the eaten Vance kind of within that subgroup is really On Target so I really just take it from the first three okay but all within the domestic Equity of that slightly larger than a third would be the all spring portfolio what I would say is of the um you know 2 point excuse me of the of the 6.6 I would say take 3 million or slightly about two and a half million from there then I'm sorry I said three I said two and a half sorry I'm I'm G take that back to three 3 million from all from all spring 2.5 from from vanguard1 from looking at rebalancing or sort of tactical opportunities where would you recommend put into um you know we're I kind of like splitting it between and now again if you have any other caching you don't think you really have any so so I would I would tend to to split between kind of domestic longer term fix with Saw Grass as well as the the shorter term a little bit more of a majority in Saw Grass so all back in domestic fix I mean all we really have are the well we've got domestic we also do have the global so PCO would also um receive receive some of that that's currently sitting 2% underweight um so that would be know roughly two and5 million nothing towards International you're you're essentially On Target so it could take you know we could throw $100,000 you know or so in there but like you said it's it's we could be seeing a ter War early next year and you know it may well work out in the long run it's a wonderful thing but in the short term it's going to be very it happens very very disruptive so I'm not sure it's probably going to hurt the rest of the world as much as it does us so I U despite being a raing internationalist just assum get the money at home so what I I'll just kind of throw some numbers out there to keep it sort of nice and even we're talking about 3 million from the all spring two and a half from Vanguard and 1.1 from gy Morgan without that 3 million going to Saw Grass two and a half to pimp go and 1.1 of sort of addressing again not doing all of it longer duration keeping some of it in that shorter duration um be portfolio but but more of it obviously going into the Sass which is the higher yelding portfolio and then obiously for me that's why we H you I make a motion to sell rebalance what I use rebalance uh 2 and half million from the Vanguard Total stock market index 3 million from the all spring or funds from termination um and then 1.1 million from the JP Morgan Equity income and purchasing or rebalancing two 1.1 million the bare shortterm bond fund 3 million to S grass and 2.5 million David Co yes John Patrick yes Matthew gry yes Jason Shar yes motion second I can say I'll make the same motion I'll say George can yes yes Ed Dawson yes John McDaniel yes Lance hwi yes de yes I make a motion that we rebalance a Target moving 2.5 from Vanguard from 3 million from large C all spring and 1.1 from J Equity to 3 million sass 2.5 million Nick Curry yes Dan Jansen yes Brandon maresma yes Jennifer rello yes that is everything that I had for you unless there are any other questions sorry was a lot but it's it's nice to be able to take some of that money off the table after Fant I don't know if this question for you or DUS but um what value is in having a Securities monitor fir for potential litigation in larger perspective of I'll speak for left um is there value in engaging with firms to at least monitor our portfolio for those potential litigation opport so it's an extra layer of someone that's looking out of investment landscape legal landscape on your so kind of as it sits now if you didn't have any of those firms then would fall so F on sing trust to kind of monitor what's happening and then you submit on your behalf you know there's a Exon Mobile it's already to pick on them but you know there was some sort of legal action CL that and you were were you an owner at the the time that that alleged stand took place they would file on your behalf so having a Securities monitoring firm they're out there again looking at the landscape looking at cases and they're also receiving they have your custodial data so that they can also look to say did you did you own security XYZ in this class period and then you know ultimately they give you this is thee you filing on their behalf or what have you um so there's no there no cost outlay to it um so trust more reactive when it comes to that they sound your description sound very passive well they're a custodial bank that's not now they're the one they hold your asset in again use the example so when it comes time to actually file and be a participant in a class action suit they're the ones that has to do it because they were holding the security for you so they're The Entity that kind of is the proof that you own it and therefore you belong right but having a class action monitoring firm you know that can help in the process less through CS what have you so it doesn't it doesn't get Salem trust out of the practice of having to file that claim or or what have you but it's somebody else that that's that's looking at the process sometimes for depending on the size of your plan they might come to you know if you got a monitoring friend they might say hey we've identified the situation we would like you to consider the main plaintiff and actually be sort of the named party that gets involved with depositions and the like for a plan of your size I think the chances of that is very very low um more likely they're just going to say Hey you were part of this this class when this thing happened make sure you're make sure you're um so essentially the just there's no real downside to it I don't yeah again I'm not an attorney um but from what I have seen there's no real downside there's no cost outlay um they're just working for a percentage of any settlement that that happens and that's determined by the court so by having them or not having them doesn't change the fee that would be associated with that sort of service um there are a number of plans that have 4 five monitoring at some point it becomes excessive you know you've got you'll have three different firms sending you a report all talking about the same case and so it can become a bit you know burdensome or overwhelming to get to have too much but having one or two again I don't see it outside does that fall under your umbrella or quite frankly more Pedro Department um now obviously if if there was a particular or whatever that that you interested in but otherwise what I would suggest is is talking to Pedro and saying hey we have interest in one or two or three firms or what have you what would you suggest you because there are some Nuance differences the type of law the type of cases so he might say well you might want a generalist and then a real Securities or whatever that's getting can we put that on the agenda for can you talk to Prior agenda for next month much U there was one more thing on kind of under your section and it's just from it's just kind of a paperwork clean up uh for the assignment from the movement from anco to Mariner and just cleaning up our contracts for the purchasing policy and stuff like that so before um just advised us that an actual form here for each board to approve and then chairman sign at the end it's just kind of to create a link between that's who our original contract was with correct David pill yes John Patrick yes Matthew broy yes Jason second George cam yes Ed Dawson yes joh yes Lance yes de yes appr second Nick Curry yes Dan Jansen yes Chris Brandon marma yes Jennifer Rell thank you everything I any other questions as a note we still need to approve the quarterly report we have not we we're getting there yeah you're right I'm sorry thank motion to approve second George cam yes Ed Dawson yes John McDaniel yes Lance yes yes motion second David coill yes John Patrick yes Matthew Bry yes Jason sh yes move that be approved second Nick Curry yes Dan Jansen yes Brandon morma yes Jennifer rello yes all right on my administor report got on the second page there at the full kind of list year that's capturing the quite a few on the police side that to clean up people leave the city and they they don't have to take their they leave and so we have just a lot of these small ones smaller balances and just trying to contact people get their money back so that you know they don't leave here 15 years kind why you see so many on there for you know a good half of those for those reasons um coming up we have the winter trustee school just open for registration I know I got um that are going to be attending so that's pretty good if anybody wants to attend and hasn't let me knowe do pretty quickly that's I contact everybody yesterday as open up those possibility I have a question are they going to do is the state going to put on that Fire Conference they do the one are they still doing that usually been in like September something I'm not sure for25 I haven heard I mean they they do every year so that something okay um I will say first meeting forif here so welcome the amount of activity that we've had at this meeting is abnormal don't expect this every time we don't move money around and that much this is probably the most and then the next thing is I provided loose Lea of the meeting calar that's kind agenda need to be adopted um if it seems like we have good attendance here this is the week of Thanksgiving so that was kind of the only question I had for next year was We Thanksgiving if you guys want to have or not week before that bren's very busy because people mov their meetings from this week to that next week so there is an opportunity we move it two weeks forward to the second Tuesday if you guys want to make a motion to am that date or we could just accept [Music] AC Nick Curry yes Janson yes Brandon marisma yes Jennifer rero Yes motion to have meting 25 written here charge cany yes Ed Dawson yes Daniel yes Lance hsh yes Debbie White yes motion keep it David cill yes John Patrick yes Matthew gry yes Jason Shar yes the general board we're going to vote on approving application for retirement are seen accting Finance effective 11 November 1st 2024 separation date October 21st 2024 meets age and service requirements for normal retirement 10 years zero months of service second Dan Jansen yes Nick Curry yes Brandon RMA yes Jennifer Rell yes second approval will be application for deferred retirement Kent Haynes technology security services manager Information Systems effective December 1st 20124 separation date July 12th 2022 meets Ag and service for def re months of service Nick Curry yes Dan Janson yes Brandon maresma yes Jennifer Rell yes on the on this one they at the back of your book it has each board and who's in each position currently so to understand to you want to keep the same you want position I will say that the doesn't currently Pro I'll make a motion make protion sorry I think we're still we're still on the general board section all right start with the chair I'm Nick Curry yes Dan Jansen yes Brendan marma yes Jennifer yes Nick Curry yes Dan Jansen yes Brandon morma yes Jennifer Rell yes secretary motion to keep Nick Curry as the secretary Nick Curry yes Dan Janson yes Brandon RMA yes Jennifer yes okay police I'll make a motion to nominate Jason Sharp you as chairperson David kill yes John Patrick yes Matthew gry yes Jason CH yes make a motion to make David coill David cohill yes John Patrick yes Matthew Bry yes Jason sh make a motion to make the absent member John Gilla the secretary second David John Patrick Matthew gry yes Jason CH yes firefighters vote on your chair well since we're on here we to Theo for missing person thing we thought we'd see if we get away chair Pro and secretary second George gandler yes Ed Dawson yes John McDaniel L yes yes all right appliation for backdrop retirement David Rice fire engineer effective November 1st 2021 separation date October 11 2024 meets age service requirements backdrop retirement 23 years two months of service so moved every second George canler yes Ed Dawson yes John Danel yes Lance yes de white yes any other discussion today that was our first firefighter retire Years first did you retire sleep all day wonderful Thanksgiving everyone