►
Description
The regular monthly meeting of the Oklahoma City Employee Retirement System, via video conference, for August 13, 2020.
A
A
B
B
C
B
A
E
Thank
you
for
joining
us
for
the
oklahoma
city,
employee
retirement
system,
video
conference
meeting.
We
have
a
few
announcements
to
make
regarding
the
virtual
meeting.
If
the
video
conference
is
disconnected
at
any
time
during
the
meeting,
it
shall
be
stopped
and
reconvened
once
the
audio
connection
is
restored.
E
A
Employees.
Pension
fund
for
over
16
years
of
dedicated
volunteer
service,
whereas
dennis
enjoyed
his
time
serving
on
the
oklahoma
city,
employee
retirement
system,
even
when
he
was
too
ill
to
attend
the
meetings
he
did
not
want
to
resign
from.
The
board
now,
therefore
be
resolved
by
the
chairman
of
the
oklahoma
city,
employee
retirement
system
that
they
do
hereby
extend
their
deepest
sympathies
to
his
wife,
barbara
and
children,
deanna
christie,
sherry
jill
and
andy,
and
his
13
grandchildren
and
seven
great-grandchildren.
A
B
E
First
of
all,
I
want
to
thank
all
dennis's
family
members
for
attending
the
meeting
this
morning.
It's
really
an
honor
to
have
you
all
with
us.
You
know
I
just
want
to
say
down
there
in
that
bottom.
Now,
therefore,
be
it
resolved
13,
grandchildren
and
seven
great-grandchildren
that
that
says
it
all.
E
F
E
A
A
B
D
E
A
E
E
B
B
E
E
B
E
B
E
B
E
Item
11
a
is
approving
anonymously
item.
11B
is
the
agreement
between
the
oklahoma
city,
employee
retirement
system
in
the
city
of
oklahoma
city,
regarding
the
city's
obligation
to
provide
certain
professional
and
non-professional
services
and
office
rental
to
the
oklahoma
city,
employee
retirement
system
and
for
the
retirement
system
to
provide
certain
professional
services
for
the
city.
B
B
E
G
G
G
G
The
plan
is
right:
at
780
million
you'll
see
that
the
end
of
july.
The
actual
return
is
positive.
Year-To-Date.
Now,
through
the
end
of
july,
the
market
value
is
down
a
little
bit
because
spending
has
has
exceeded
the
the
return
on
investment
over
the
that
that
period
of
time,
but
certainly
about
back
to
where,
from
an
asset,
value
standpoint
where
we
were
at
the
beginning
of
the
year.
G
So
over
time,
we're
not
going
to
get
all
of
the
upside,
but
hopefully
by
getting
less
when
markets
go
down
by
capturing
less
of
that
downside,
the
assets
compounded
at
a
greater
rate
and
we
get
a
little
bit
better
excess
return
over
long
periods
of
time
and
you're
you're,
certainly
seeing
that
now
reflected
in
these
numbers.
So
at
the
very
top
here,
year-to-date
numbers
in
a
period
where
the
first
quarter
was
significantly
down
and
the
second
quarter
saw
a
rebound
overall.
G
While
that
was
a
good
year
on
a
on
a
relative
basis
and
even
relative
to
peers
oftentimes.
We
don't
see
this
portfolio
up
as
much
as
as
peers
when,
when,
when
markets
are
up
but
really
getting
some
some
good
return.
Relative
excess
return
from
managers
from
both
downside
protection
and
during
this
rebound
I'm
going
to
go
to
the
monthly
report,
because
you'll
see
we
can
highlight
a
little
bit
more
where,
where
the
access
return
is
coming
from.
G
That's
not
to
say
that
we're
think
we're
out
of
the
woods.
Yet
you
know.
Expectations
across
market
caps
and
geographies
and
industries
are
still
very
uncertain,
but
what
we've
have
seen
is
is
pretty
concentrated
leadership
in
a
couple
of
sectors:
technology
specifically
within
the
large
cap
space
names
like
facebook,
apple
amazon,
netflix,
google,
representing
over
25
of
the
s
p
500
at
at
points
in
time
during
the
quarter,
as
well
as
health
care
and
biotech.
G
So
the
predominantly
growth
oriented
sectors
of
the
market
have
significantly
outperformed
within
large
cap
on
a
trailing
one-year
basis,
and
I
think
I
mentioned
this
last
month
that
this
we,
this
hasn't
dissipated
the
russell
1000
growth,
which
is
the
large
cap.
Us
growth
index
is
up
36
percent
on
a
trailing
one
year,
whereas
the
value
index
is
up
two
percent
so
about
a
34
differential.
G
Your
growth
managers
have
done
exceedingly
well,
but
particularly
within
small
cap
as
we'll
see
earnest,
which
is
more
of
a
relative
value
manager,
as
opposed
to
a
deeper
value
manager,
and
they
do
have
some
factors
within
their
security
selection
that
that
really
makes
them
look
a
little
bit
different
than
traditional,
deep
value
or
contrarian
managers.
That
has
really
benefited.
G
This
is
now
on
the
k2
mauna
kea
platform,
up
about
almost
11
on
a
trailing
one-year
basis
relative
to
long-only
global
equities.
It's
it's
added
about
300
basis
points,
so
pretty
significant
outperformance
there
and
pretty
significant
outperformance
relative
to
the
hedged
equity
benchmark,
the
hfri
fund
to
fund
strategic
private
equity.
G
While
you
know
typically,
you
know
we're
looking
at
private
equity
as
a
return
enhancer
over
time,
and
it
has
done
that
over
long
term,
you're,
seeing
in
the
quarter
specifically
while
this
shows
the
the
month
of
july
is
flat.
That's
just
because
there's
not
been
updates
to
market
values
that
the
june
quarter.
We
did
see
the
impact
of
the
downturn
in
the
first
quarter,
reflected
in
valuations
of
private
equity
holdings
in
that
was
reflected
in
the
second
quarter,
because
there's
a
lag
in
in
private
markets.
G
The
em
small
cap
manager
has
certainly
has
a
decidedly
growth
bias
to
them,
whereas
the
the
wells
berkeley
street
is
more
of
a
core,
but
with
with
a
little
bit
of
a
growth
bias,
really
avoiding
some
of
the
more
beaten
down
value
sectors
and
you've
gotten
really
nice
excess
return
there
over
over
10.
So
it's
certainly
good
to
see
that
the
type
of
return
you're
getting
from
your
managers
in
a
pretty
volatile
market
environment.
G
They
are
more
than
participating
in
in
the
rebound,
but
you
know
you're
getting
that
benefit
from
being
down
less
in
the
downdraft.
So
overall,
on
a
one-year
basis.
Now
total
fund
gross
of
fees
up
8.1,
neta
fees,
7.6
relative
to
the
policy
index
at
6.7,
so
about
90
basis,
points
of
excess
return,
net
of
fees
on
a
on
a
one-year
basis
so
certainly
attractive,
and
then
relative
to
your
you
know,
requ
actuarial,
assumed
rate
of
return.
G
You've
been
very
diligent
in
recognizing
that
we
are
in
a
muted
return
environment
going
forward
just
looking
back
historically
at
what
markets
have
done,
isn't
a
good
indicator
going
forward,
because
valuations
are
stretched.
Interest
rates
remain
at
historic
lows.
If
we
were
saying
interest
rates
were
at
historic
lows
a
year
and
a
half
ago
more
than
10
year
was
at
three
percent.
G
Well,
now
we're
at
even
more
historic
lows
where
the
10
years
at
about
a
half
a
half
a
percent
a
little
over
60
basis
points
now
that
that
is
going
to
have
an
impact
on
future
returns
in
both
the
equity
and
fixed
income
markets
and
you've
been
cognizant
of
that.
By
being
fairly,
you
know,
conservative,
in
in
establishing
that
required
return
assumption
and
bringing
that
down
now
to
seven
percent
the
fixed
income
portfolio
on
a
trailing
one
year.
G
G
Not
a
lot
a
lot,
not
a
lot
more
room
for
rates
to
go
down,
so
your
fixed
income
portfolio
has
been,
and
continues
to
be,
structured
to
have
less
sensitivity
to
rate
movements,
which
is
a
positive
and
a
sustained
low
rate
to
rising
rate
environment
and
more
return,
drivers
with
respect
to
credit
and
currency
and
other
things,
and
we've
certainly
seen
the
benefit
of
that
over
the
last
few
months.
This
this
report,
year
to
date
and
one
month,
isn't
really
reflecting
that
as
much.
G
You
see
it
in
the
one
month
where
you
know,
you've
got
up
almost
a
one
in
three
quarters
percent
premium,
but
that's
really
been
sustained
over
the
quarter
as
a
whole.
Your
bond
managers
have
have
added
quite
a
bit
of
value
brandywine
on
the
non-u.s
side
as
well
as
so
you
see
brandywine
for
just
the
month
of
july,
up
six
percent
western
year-to-date.
G
G
G
I
believe
it
was
yesterday.
I'm
sorry,
I'm
just
I'm
looking
through
my
notes
here,
but
but
that
funding
has
occurred.
The
expectation
is
another
portion
of
the
pamko.
Money
will
come
in
october
about
20
percent
more
and
then
there'll
be
a
hold
back
it'll
it
it's
going
to
take
some
time
for
that
to
be
completely
wound
down
because
of
some
of
the
positions
aren't
as
as
liquid.
G
So
it's
going
to
take
take
a
little
bit
of
time,
but
the
pgm
was
was
funded
so
that
we
have
in
place
now
and
that
that's
daily
liquid.
So
all
in
all,
you
know
a
very
strong
rebound
for
the
portfolio,
both
absolute
terms
and
and
relative
returns.
We're
very
pleased
with
with
manager
performance
from
an
allocation
standpoint
just
continue
to
be
a
little
bit
overweight
to
equities
because
of
the
bounce
back.
G
We
just
raised
some
some
money
to
for
benefit
payments
for
the
next
couple
of
months
that
26
million
in
cash
wasn't
is
not
there
now,
because
it
was
used
to
fund
pgm,
and
we
raised
10
million
this
week
from
large
cap.
The
ssga
fund
for
august
and
september
benefit
payments
and
just
to
have
a
little
bit
of
a
buffer
there.
In
the
event,
there's
any
capital
calls
from
from
private
equity.
G
G
This
primarily
is
a
result
of
changes
made
to
the
allocation,
replacing
the
pamco
low
volatility,
hedge
fund
strategy,
with
the
the
liquid
absolute
return
strategy,
so
just
bringing
the
policy
in
line
with
that,
but
also
we
are
required-
or
you
know
it's
good
practice,
best
practice
to
review
policies
on
a
on
an
annual
basis
and
there's
just
a
couple
of
cleanup
items
that
we're
proposing
so
most.
As
I
mentioned,
this
is
really
all
just
administrative
and
cleanup
the
first
item.
G
You've
had
an
allocation
to
real
estate
and
guidelines
for
real
estate
for
some
time,
but
this
section
on
objectives
and
guidelines.
There
were
paragraphs
related
to
equity
and
fixed
income.
We
didn't
have
a
paragraph
on
real
estate,
so
just
to
make
it
consistent
and
flow
better.
This
paragraph
was
added:
it's
not
changing
what
you've
already
been
doing
and
you've
already
had
an
allocation
to
real
estate.
That
was
reflected
in
other
places
in
the
policy.
G
Next
is
with
respect
to
the
allocation
on
page
five,
just
changing
out
the
low
volatility
hedge
fund
strategy
for
liquid
absolute
return.
This
you've
approved
this
allocation
changes,
it's
just
reflecting
that
the
different
really
nomenclature
and
what
we're
call,
what
we
call
this
strategy
and
what
it
is
in
the
policy.
G
Also,
this
statement
here
about
with
certain
hedge
fund
strategies,
maybe
in
the
fixed
income
portfolio,
because
the
liquid
absolute
return
is
not
a
hedge
fund
strategy.
It's
not
you're,
not
implementing
that
through
a
hedged
hedge
fund
vehicle,
it
is
a
daily
liquid
mutual
fund.
So
we
just
took
out
that
reference.
There.
G
Page
six
again,
just
reflecting,
as
I
mentioned
you
as
you,
bring
down
that
actuarial,
assumed
rate
of
return,
we're
just
reflecting
what
it
currently
is.
We
we
confirmed
this
with
regina.
I
believe
that
that
is
what
your
current
assumed
rate
of
return
is
so
just
reflecting
that
the
next
is
on
page
17,.
G
So
this
is
the
appendix
begins
on
page
seven
and
that
the
appendix
includes
specific
asset
class
guidelines
they're
pretty
much
similar
in
terms
of
the
criteria.
We
have
investment
objective
guidelines
if
they're
they're
asset
classes,
where
you
have
separate
accounts
which
at
this
point
is
real,
is
just
large
cap
and
small
cap
and
then
performance
criteria
and
objectives
and
communication
requirements
for
the
managers.
So
they
all
look
pretty
similar
with
some
slight
exceptions.
So
one
is
in
private
equity.
We
have
a
stated
return
objective,
which
is
on
page.
G
G
So
this
objective,
we
had
previously
had
a
500
basis,
point
premium
to
the
s
p
500.
and
that
that
was
that
language
really
goes
back
to
when
you
first
implemented
private
equity
over
13
years
ago
to
be
more
our
long-term
capital
market
assumptions.
Today,
our
our
capital
market,
assumption
for
private
equity,
is
about
a
two
and
a
half
percent
premium
to
long-only
equities.
So
this
is
just
more
reflective.
We're
not
we're
we're
not
changing
what
we're
doing
in
private
equity
we're
still.
G
G
It
is
but
like
the
five
to
seven
most,
the
funds
you're
investing
in
have
a
10
to
12
year
time
horizon.
So
as
the
program
becomes
more
mature,
meaning
it's
getting
closer
to
fully
funded,
you
know
it.
We
should
expect
that
premium
over
time,
but
periods
like
the
last
10
years
when
public
markets
are
up.
G
The
big,
what
appears
to
be
big
changes
or
additions
is
really
just
the
the
removal
of
the
long,
the
low
volatility
hedge
fund
guidelines,
because
pamko
is
coming
out
and
then
the
addition
of
specific
guidelines
for
for
liquid
absolute
return,
because
it's
implemented
in
a
commingled
fund.
We
we
try
to
mimic
how
they
describe
the
the
fun
guidelines
here,
but
performance
criteria
similar
to
your
other
managers,
with
this
asset
class,
liquid
absolute
return
and
this
strategy
doesn't
really
have
a
benchmark.
D
B
G
G
These
will
all
be
at
11
o'clock
on
those
those
dates
and
so
we're
you
know,
trying
to
think
of
ways
to
help.
You
know
fill
the
gap,
perhaps
that
the
the
public
fund
conference
that
won't
be
happening
this
year
and
try
to
provide
some
educational
opportunities
for
our
clients
in
general.
So
hopefully
you
know
these
will
be
some
relevant
and
good
information
for
you
all
and
we
really
look
forward
to
you
attending.
The
other
thing
that
I
wanted
to
mention
is
regina,
and
I
talked
about
this.
G
The
other
day
we
we'd
like
to
do
kind
of
like
a
new
trustee
education
session.
Just
for
you
all,
for
or
or
you
know,
just
a
trustee
refresher
course
where
we
can
do
an
hour,
hour-long
webinar,
that's
more
specific
and
geared
toward
toward
your
plan
kind
of
like
what
is
done
the
first
day
of
the
public
fun
conference
in
in
the
afternoon,
but
a
little
bit
more
geared
to
you
all,
and
so
I
want
to
work
with
regina.
G
E
G
E
Okay
item
number
13
on
the
agenda
is
comments
from
board
staff
and
citizens.
I
want
to
jump
in
real,
quick
and
give
a
big
thank
you
to
our
new
ers
manager.
She
has
not
to
sound
too
cliche,
but
she
has
taken
the
bull
by
the
horns
and
I
have
been
extremely
impressed
with
her
diving
in
and
is
doing
everything
that
we
expect
our
manager
to
do.