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From YouTube: Oklahoma City Employee Retirement System - March 9, 2023
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A
B
B
C
A
D
So
we
have
the
the
monthly
report
and
then
have
a
recommendation
on
the
investment
policy.
Following
up
on
the
asset
allocation
discussion
that
we
had
last
month,
it
seems
we're
still
talking
about
interest
rates
and
inflation
that
hasn't
ended.
Month
of
February.
We
saw
the
FED
while
slowing
the
pace
of
rate
hikes
down
to
a
25
basis.
Point
increase
from
the
50
basis
point
increases
that
we
had
seen.
Expectations
for
the
terminal,
fed
funds
rate
went
up
in
February
and
expectations
were
around.
Inflation
still
remained
elevated.
D
Number
worse
than
expectations
in
the
market
was
up
an
indication
that,
if
the
job
we
had
more
or
more
people
filing
for
unemployment
than
was
expected-
and
that
was
looked
upon
by
the
market
as
a
positive
thing,
I
I
think
all
this
is
a
lot
of
noise.
It's
what
we
hear
day
in
and
day
out
and
certainly
impacts
portfolios
month
over
month.
D
It's
important
to
keep
that
long-term
time
Horizon
in
mind,
which
is
what
we
talked
about
last
month
and
looking
at
your
your
longer
term
results
as
as
a
pension
fund,
trustee
and
understanding
of
long-term
liabilities
and
long-term
asset
allocation.
It's
just
challenging
as
we
go
from
month
to
month.
That
said,
if
we
look
on
the
left
side
of
of
this
pay
upper
left
of
this
page
year
to
date,
a
couple
of
bright
spots,
small
cap
and
international
developed
are
up
mid
single
digits
for
the
first
two
months
of
the
year.
D
Small
caps
up
about
eight
percent,
which
is
the
Russell
2000,
the
efe
International
Development
Benchmark,
is
up
almost
six
percent,
despite
a
challenging
February
worst
performing
asset
class
or
our
Market
in
the
month
of
February,
was
Emerging.
Markets,
we
saw
a
bit
of
a
pretty
big
sell-off
there
down
six
and
a
half
percent
in
the
month,
but
still
positive
on
the
year
as
we
look
at
your
portfolio
on
the
next
page
in
terms
of
asset
allocation,
roughly
in
line
with
with
targets
overall.
D
13
basis
points
underweight
to
to
equities,
but
essentially
inline
slight
underweight
to
fixed
income.
However,
the
cash
component,
because
we
raise
cash
for
your
operating
needs,
benefit
payments
and
to
have
a
little
bit
of
cash
to
cover
potential
Capital
calls
that
may
come
in
today.
That's
not
a
drag
you're
getting
four
and
a
half
to
five
percent
on
on
cash.
So
it's
it's
comparable
to
fixed
income.
D
So
as
we
look
at
fixed
income
and
cash
right
at
that
20
percent
and
then
real
estate
effectively
at
the
Target
a
little
bit
overweight
to
core
as
we're
continuing
to
build
up
that
the
opportunistic
piece,
which
is
the
star
woods
and
the
the
Blackstone
commitments
that
you
made
in
2021
and
and
2022
that
haven't
been
called
down.
Yet
they
we
would
anticipate
that
they'll
start
to
call
Capital
in
the
in
the
coming
months
from
a
performance
standpoint
on
page
five
you'll
see
a
month
once
so
we
did
add,
we've
been
collecting
meta
fee
data.
D
D
That's
why
you
see
blanks
under
the
the
net
a
fee
returns,
but
now
we
have
10
years
returns
of
gross
and
net
returns
for
all
of
these
asset
classes
and
the
underlying
managers.
So
it's
a
little
bit
busier,
but
hopefully
this
is
a
helpful
view.
So
your
large
cap
composite
down
about
a
little
under
eight
percent
gross
of
fees.
Eight
point:
one
four
slightly
trailing
The
Benchmark
much
of
this
has
been
in
Tech
we're
trying
to
implement
a
benchmark
risk
controlled
allocation
within
large
cap.
D
D
The
more
volatile
stocks
in
that
index
from
a
price
standpoint
tend
to
be
the
smaller
capitalized
stocks
in
a
period
of
time
over
the
it
tends
to
outperform
in
periods
where
the
smaller
cap
companies
are
outperforming
within
the
large
cap
index
and
underperform
when
they're
slightly
underperforming-
and
that's
that's
what's
causing
this
dispersion.
Currently
your
overall
small
cap
allocation.
This
is
the
combination
of
earnest
and
silvercrest.
Now,
nice
protection
in
a
year
where
markets
are
down
a
lot
of
that
coming
from
Earnest
on
the
Val,
more
value-oriented
side
longer
term,
you
see
good
results
there.
D
Long
short,
Equity,
I'd,
say
year-to-date
numbers.
We're
got
we're
getting
positive
numbers
for
the
month,
we're
getting
some
protection.
We've
made
some
tweaks
there.
There
was
a
little
bit
more
beta
and
growth
exposure
within
that
portfolio
that
impacted
the
the
one-year
returns,
certainly
more
so
in
the
January
February
time
period
of
last
year.
We're
pleased
with
the
tweaks
we've
made.
D
You
don't
see
it
on
here,
but
if
we
look
at
this
portfolio
from
mid
2022,
let's
say
July
forward:
we've
gotten
nice
out
performance
in
the
up
months
and
and
good
protection
in
the
Dow
months
over
that
eight
month
period.
This
is
an
area
that
we
had
recommended
last
month
when
we
did
asset
allocation
work
that
we
bring
trim
this
down
a
little
bit
to
a
five
percent.
Target
and
bumping
up
private
equity
you'll,
see
private
Equity
numbers
now
on
a
one-year
basis,
you're
starting
to
see
marks
flow
through.
D
As
we
looked
at
2022
performance,
private
Equity
lags
public
markets.
It's
not
marked
to
Market
on
a
daily
basis
like
your
public
market,
so
it
really
was
providing
some
from
a
valuation
standpoint.
Some
protection
but
you're
starting
to
see,
marks
flow
through
and
and
you've
got
a
negative
return
now
on
a
trailing
one
year.
That
said,
longer
term,
if
we
look
at
the
tenure
numbers-
and
these
are
net
of
all
fees
and
management
fees
and
carried
interest
of
the
Partnerships
10-year
return-
is
15.8
percent
relative
to
U.S
large
cap
at
12
and
a
quarter
percent.
D
Our
Target
here
is
effectively
two
per
200
basis
points
above
public
markets
for
that
illiquidity
premium
and
you've
got
that
and
a
little
bit
more
over
this
trailing
10-year
period,
as
your
private
Equity
portfolio
has
really
begun
to
mature
I
mean
early
on.
You
didn't
have
a
lot
of
dollars
there.
Now
it's
a
much
more
significant
piece
at
about
eight
and
a
half
percent
of
the
total
fund,
International
developed
combination
of
Harding,
lovener
and
Lazard.
D
D
We
pulled
this
up
just
as
a
reminder
for
folks
what
this
effectively
does.
It
improves
the
improves
the
expected
return.
The
median
expected
return
improves
the
probability
of
achieving
your
seven
percent
return
over
the
time.
Horizon
and
doesn't
incrementally
add
significant
risk.
It
actually
lowers
the
first
percentile
return,
which
is
the
worst
case
scenario
and
improves
the
the
sharp
ratio
slightly,
which
is
risk
risk
adjusted
return.
D
So
our
our
recommendation
is
to
make
a
slight
tweak
to
the
policy
which
is
on
I,
think
you
all
have
a
copy
of
the
policy
simply
on
page
five
of
the
policy
making
those
modifications
to
the
Target
asset
allocation
there
in
the
middle
of
the
page,
reducing
long
short
from
a
target
of
ten
to
five
and
increasing
the
target
of
private
Equity
from
10
to
15
and
just
keeping
those
ranges
at
plus
or
minus
five
percent
private
Equity.
B
D
Don't
I
don't
I,
don't
think
it
would
get
to
zero
I.
A
Anyone
else
hearing,
Nunn
chair
will
entertain
a
motion
on
item
12.