11/13/2017Monday, November 13, 2017
1:00 PM
City of Clearwater
City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
Council Chambers
Pension Trustees
Meeting Agenda
November 13, 2017Pension Trustees Meeting Agenda
1. Call To Order
2. Approval of Minutes
2.1 Approve the minutes of the October 16, 2017 Pension Trustees Meeting as
submitted in written summation by the City Clerk.
3. Citizens to be Heard Regarding Items Not on the Agenda
4. New Business Items
4.1 Approve the new hires for acceptance into the Pension Plan as listed.
4.2 Approve the following request of employee Darci Willis, Public Utilities
Department, to vest their pension as provided by Section 2.419 of the
Employees’ Pension Plan.
4.3 Approve the following request of employees Dane Heatherington, Engineering
Department, James Hornaday, Gas Department and Anthony Sammartano,
Fire Department, for a regular pension as provided by Sections 2.416 and 2.424
of the Employees’ Pension Plan.
4.4 Approve the termination of small cap value equity money manager Systematic
Financial Management and authorize the appropriate officials to execute same.
4.5 Approve an agreement with Victory Capital for investment in their Sycamore
Small Cap Value Equity product, and authorize the appropriate officials to
execute same.
4.6 Approve a new agreement between the City of Clearwater and the law firm of
Klausner Kaufman Jensen and Levinson, to serve as outside counsel to the
Pension Trustees and the Pension Advisory Committee (PAC), and authorize
the appropriate officials to execute same.
5. Other Business
6. Adjourn
Page 2 City of Clearwater Printed on 11/8/2017
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-3976
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 1
File Type: MinutesIn Control: Pension Trustees
Agenda Number: 2.1
SUBJECT/RECOMMENDATION:
Approve the minutes of the October 16, 2017 Pension Trustees Meeting as submitted in written
summation by the City Clerk.
SUMMARY:
APPROPRIATION CODE AND AMOUNT:
USE OF RESERVE FUNDS:
Page 1 City of Clearwater Printed on 11/8/2017
Pension Trustees Meeting Minutes October 16, 2017
City of Clearwater
City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
Meeting Minutes
Monday, October 16, 2017
1:00 PM
Council Chambers
Pension Trustees
Page 1
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
Roll Call
Present 5 - Chair George N. Cretekos, Trustee Doreen Caudell, Trustee Bob
Cundiff, Trustee Hoyt Hamilton, and Trustee Bill Jonson
Also Present – William B. Horne – City Manager, Jill Silverboard – Deputy City
Manager, Micah Maxwell – Assistant City Manager, Pamela K.
Akin – City Attorney, Rosemarie Call – City Clerk, and Joe Roseto
– Human Resources Director
To provide continui ty for research, items are listed in agenda order although not
ne cessarily discussed in that order.
Unapproved
1. Call To Order – Chair Cretekos
The meeting was called to order at 1:20 p.m. 2. Approval of Minutes
2.1 Approve the minutes of the September 18, 2017 Pension Trustees Meeting as submitted
in written summation by the City Clerk.
Trustee Cundiff moved to approve the minutes of the September
18, 2017 Pension Trustees Meeting as submitted in written
summation by the City Clerk. The motion was duly seconded and
carried unanimously.
3. Citizens to be Heard Regarding Items Not on the Agenda – None. 4. New Business Items
4.1 Approve the new hires for acceptance into the Pension Plan as listed.
Name/Job Classification/Department Pension
Eligibility Date
Eric Jewett, Code Enforcement Inspector, Planning and Development 08/07/2017
Marcus Bullock, Police Property Clerk, Police 08/07/2017
Reginald Jackson, Solid Waste Equipment Operator, Solid Waste 08/07/2017
Page 2
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
Harlan Hamilton, Solid Waste Equipment Operator, Solid Waste 08/07/2017
Teresa Mitchell Grein, Service Dispatcher, Gas 08/14/2017
Miranda Wincek, Police Cadet, Police 08/21/2017
Brian Aden, Legal Staff Assistant, Legal 08/21/2017
Theodore Hordych, Traffic Signal Technician, Engineering 08/21/2017
Kristian Greve, Traffic Signal Technician, Engineering 08/21/2017
Terry Johnson, Water Distribution Operator Trainee, Public Utilities 08/21/2017
Taylor Thomason, Recreation Leader, Parks and Recreation
08/21/2017
Trustee Caudell moved to approve the new hires for acceptance
into the Pension Plan as listed. The motion was duly seconded
and carried unanimously.
Ayes: 5 - Chair Cretekos, Trustee Caudell, Trustee Cundiff, Trustee Hamilton
and Trustee Jonson
4.2 Approve the following request of employees Adam Jacques, Police Department and
Matthew Roach, Solid Waste General Services Department, to vest their pensions as
provided by Section 2.419 of the Employees’ Pension Plan.
Adam Jacques, Police Officer, Police Department, was employed by the City on
January 8, 2007, and began participating in the Pension Plan on that date. Mr.
Jacques terminated from City employment on August 04, 2017.
Matthew Roach, Solid Waste Equipment Operator, Solid Waste General
Services Department, was employed by the City on March 11, 2002, and began
participating in the Pension Plan on that date. Mr. Roach terminated from City
employment on January 11, 2017.
The Employees’ Pension Plan provides that should an employee cease to be an
employee of the City of Clearwater or change status from full-time to part-time
after completing ten or more years of creditable service (pension participation),
such employee shall acquire a vested interest in the retirement benefits.
Vested pension payments commence on the first of the month following the
month in which the employee normally would have been eligible for retirement.
Section 2.416 provides for normal retirement eligibility for non-hazardous duty
employees hired prior to the effective date of this reinstatement (January 1,
2013), a member shall be eligible for retirement following the earlier of the date
on which a participant has reached the age of fifty-five years and completed
twenty years of credited service; the date on which a participant has reached
age sixty-five years and completed ten years of credited service; or the date on
Page 3
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
which a member has completed thirty years of service regardless of age. For
non-hazardous duty employees hired on or after the effective date of this
restatement, a member shall be eligible for retirement following the earlier of the
date on which a participant has reached the age of sixty years and completed
twenty-five years of credited service; or the date on which a participant has
reached the age of sixty-five years and completed ten years of credited service.
Mr. Roach will meet the non-hazardous duty criteria and begin collecting a
pension in April 2022.
Section 2.416 provides for normal retirement eligibility for hazardous duty
employees, a member shall be eligible for retirement following the earlier of the
date on which the participant has completed twenty years of credited service
regardless of age, or the date on which the participant has reached fifty-five
years and completed ten years of credited service. Mr. Jacques will meet the
hazardous duty criteria and begin collecting pension in February 2027.
Trustee Cundiff moved to approve the following request of
employees Adam Jacques, Police Department and Matthew
Roach, Solid Waste General Services Department, to vest their
pensions as provided by Section 2.419 of the Employees’ Pension
Plan. The motion was duly seconded and carried unanimously.
4.3 Approve the following request of employees John Fahey, Planning and Development
Department, Stephen Finney, Gas Department, Cheryl Ford, Finance Department,
Donald Hall, Police Department, Jay Holsombach, Police Department, Michael Pryor,
Solid Waste General Services, Clyde Renfroe, Police Department and Brian Sweeney,
Library Department for a regular pension as provided by Sections 2.416 and 2.424 of the
Employees’ Pension Plan.
John Fahey, Plan Examiner, Planning and Development Department, was
employed by the City on May 15, 2006, and his pension service credit is
effective on August 7, 2006. His pension will be effective October 1, 2017.
Based on an average salary of approximately $47,246.18 over the past five
years, the formula for computing regular pensions and Mr. Fahey’s selection of
the Life Annuity, this pension benefit will be approximately $14,407.44 annually.
Stephen Finney, Gas Tech II, Gas Department, was employed by the City on
September 15, 1997, and his pension service credit is effective on that date.
His pension will be effective October 1, 2017. Based on an average salary of
approximately $37,756.77 over the past five years, the formula for computing
regular pensions and Mr. Finney’s selection of the 66 2/3% Joint and Survivor
Annuity, this pension benefit will be approximately $19,187.88 annually.
Page 4
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
Cheryl Ford, Accountant, Finance Department, was employed by the City on
November 28, 1994, and her pension service credit is effective on that date.
Her pension will be effective September 1, 2017. Based on an average salary of
approximately $45,769.41 over the past five years, the formula for computing
regular pensions and Ms. Ford’s selection of the 100% Joint and Survivor
Annuity, this pension benefit will be approximately $25,329.00 annually.
Donald Hall, Police Deputy Chief, Police Department, was employed by the City
on May 21, 1984, and his pension service credit is effective on that date. His
pension will be effective October 1, 2017. Based on an average salary of
approximately $109,048.88 over the past five years, the formula for computing
regular pensions and Mr. Hall’s selection of the 100% Joint and Survivor Annuity,
this pension benefit will be approximately $97,953.96 annually.
Jay Holsombach, Police Sergeant, Police Department, was employed by the
City on April 28, 1997, and his pension service credit is effective on that date.
His pension will be effective October 1, 2017. Based on an average salary of
approximately $105,287.08 over the past five years, the formula for computing
regular pensions and Mr. Holsombach’s selection of the Life Annuity, this
pension benefit will be approximately $64,304.64 annually.
Michael Pryor, Solid Waste Program Coordinator, Solid Waste General
Services Department, was employed by the City on November 2, 1987, and his
pension service credit is effective on that date. His pension will be effective
December 1, 2017. Based on an average salary of approximately $65,532.73
over the past five years, the formula for computing regular pensions and Mr.
Pryor’s selection of the 100% Joint and Survivor Annuity, this pension benefit will
be approximately $50,147.52 annually.
Clyde Renfroe, Police Officer, Police Department, was employed by the City on
June 9, 1997, and his pension service credit is effective on that date. His
pension will be effective September 1, 2017. Based on an average salary of
approximately $93,427.52 over the past five years, the formula for computing
regular pensions and Mr. Renfroe’s selection of the 100% Joint and Survivor
Annuity, this pension benefit will be approximately $51,145.44 annually.
Brian Sweeney, Library Assistant, Library Department, was employed by the
City on December 23, 1996, and his pension service credit is effective on
September 15, 1997. His pension will be effective October 1, 2017. Based on
an average salary of approximately $32,770.44 over the past five years, the
formula for computing regular pensions and Mr. Sweeney’s selection of the Life
Annuity, this pension benefit will be approximately $18,026.28 annually.
Section 2.416 provides for normal retirement eligibility for non-hazardous duty
employees hired prior to the effective date of this reinstatement (January 1,
2013), a member shall be eligible for retirement following the earlier of the date
on which a participant has reached the age of fifty-five years and completed
twenty years of credited service; the date on which a participant has reached
Page 5
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
age sixty-five years and completed ten years of credited service; or the date on
which a member has completed thirty years of service regardless of age. For
non-hazardous duty employees hired on or after the effective date of this
restatement, a member shall be eligible for retirement following the earlier of the
date on which a participant has reached the age of sixty years and completed
twenty-five years of credited service; or the date on which a participant has
reached the age of sixty-five years and completed ten years of credited service.
Mr. Fahey, Mr. Finney, Ms. Ford, Mr. Pryor and Mr. Sweeney have met the
non-hazardous duty criteria.
Section 2.416 provides for normal retirement eligibility for hazardous duty
employees, a member shall be eligible for retirement following the earlier of the
date on which the participant has completed twenty years of credited service
regardless of age, or the date on which the participant has reached fifty-five
years and completed ten years of credited service. Mr. Hall, Mr. Holsombach
and Mr. Renfroe have met the hazardous duty criteria.
Trustee Hamilton moved to approve the following request of
employees John Fahey, Planning and Development Department,
Stephen Finney, Gas Department, Cheryl Ford, Finance
Department, Donald Hall, Police Department, Jay Holsombach,
Police Department, Michael Pryor, Solid Waste General Services,
Clyde Renfroe, Police Department and Brian Sweeney, Library
Department for a regular pension as provided by Sections 2.416
and 2.424 of the Employees’ Pension Plan. The motion was duly
seconded and carried unanimously.
4.4 Approve the termination of international emerging markets equity money manager Eaton
Vance and authorize the appropriate officials to execute same.
Eaton Vance was hired as an international emerging markets equity manager
for the plan in February 2008. As of June 30, 2017, the market value of the
plan’s investment in Eaton Vance totaled $36.45 million, or 3.79% of the total
investment portfolio. Eaton Vance’s performance has steadily declined in recent
years, as detailed below. The Pension Investment Committee unanimously
recommends termination at this time.
Percentile
As of 6/30/2017 Eaton Vance Ranking Benchmark
Last 3 years (1.16)% 91st 1.44%
Last 5 years 3.25% 95th 4.33%
Page 6
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
Staff will be bringing a separate agenda item forward for the replacement of
Eaton Vance in the international emerging markets equity portfolio category.
Trustee Jonson moved to approve the termination of
international emerging markets equity money manager Eaton
Vance and authorize the appropriate officials to execute same.
The motion was duly seconded and carried unanimously.
4.5 Approve investment of up to $40,000,000 in the Dimensional Fund Advisors (DFA)
Emerging Markets Core Equity Portfolio mutual fund and authorize the appropriate
officials to execute same.
The plan’s emerging markets international equity money manager has been
recommended for termination per a previous agenda item.
At the May 2017 pension investment committee quarterly meeting, the
committee requested the plan’s investment performance consultant, CapTrust
Advisors, to conduct a manager search for a replacement emerging markets
equity manager. At a special meeting of the committee on June 19, 2017, the
committee unanimously selected DFA Emerging Markets Core Equity Portfolio
for a due diligence interview of the firm, which was subsequently conducted at
the committee’s August 2017 quarterly meeting.
The pension investment committee unanimously recommends DFA Emerging
Markets Core Equity Portfolio mutual fund to the Trustees for an investment of
up to $40 million, or approximately 4% of the total plan investment portfolio.
As of July 31, 2017, DFA Emerging Markets Core Equity Portfolio’s performance
over the past ten years has been as follow:
Performance Benchmark
Last 3 years 2.98% 2.39%
Last 5 years 5.69% 4.76%
Last 10 years 2.92% 1.98%
The DFA Emerging Markets Core Equity Portfolio mutual fund is only available
to institutional investors. It has a management fee of 0.47% and a net expense
ratio of 0.53% per the fund’s February 2017 prospectus.
APPROPRIATION CODE AND AMOUNT:
0646-07410-530100-585-000-0000 $188,000 annually
Page 7
City of Clearwater Draft
Pension Trustees Meeting Minutes October 16, 2017
In response to questions, Accounting Manager Mary Beth Setter said the
performance is higher than the benchmark; during the last three years it has
been 2.98%. The emerging market funds are volatile funds. Staff is trying to
find a manager who can provide a better percentile return than the market
and the index.
Trustee Cundiff moved to approve investment of up to
$40,000,000 in the Dimensional Fund Advisors (DFA) Emerging
Markets Core Equity Portfolio mutual fund, and authorize the
appropriate officials to execute same. The motion was duly
seconded and carried unanimously.
5. Adjourn
The meeting adjourned at 1:27 p.m.
Chair
Employees’ Pension Plan Trustees
Attest
City Clerk
Page 8
City of Clearwater Draft
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-3918
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 2
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.1
SUBJECT/RECOMMENDATION:
Approve the new hires for acceptance into the Pension Plan as listed.
SUMMARY:
Name/Job Classification/Department Pension
Eligibility Date
Margaux La Barge, Customer Service Representative, Customer Service 09/02/2017
John Mellor, Solid Waste Equipment Operator, Solid Waste 09/04/2017
Sara Bayly, Customer Service Representative, Customer Service 09/05/2017
John Anderson, Accountant, Gas 09/05/2017
Madai Gutierrez, Recreation Specialist, Parks and Recreation 09/05/2017
Yiannis Halvatzis, Recreation Specialist, Parks and Recreation 09/05/2017
Christopher Tisdale, Parks Service Technician I, Parks and Recreation 09/05/2017
Charles Hargrove, Parks Service Technician III, Parks and Recreation 09/05/2017
Haris Kasumovic, Water Distribution Operator Trainee, Public Utilities 09/05/2017
Tyraven Jackson, Water Distribution Operator Trainee, Public Utilities 09/05/2017
Kenneth Fluitt, Jr. , Solid Waste Equipment Operator, Solid Waste 09/05/2017
DeVante Lang, Solid Waste Worker, Solid Waste 09/16/2017
Eric Saccasyn, Fire Inspector II, Fire 09/18/2017
APPROPRIATION CODE AND AMOUNT:
N/A
USE OF RESERVE FUNDS:
N/A
Page 1 City of Clearwater Printed on 11/8/2017
Interoffice Correspondence Sheet
TO: Pension Advisory Committee
FROM: Joseph Roseto, Human Resources Director
SUBJECT: Recommendation for Acceptance into Pension Plan
DATE:
Subject/Recommendation: Recommend approval of the new hires for acceptance into the Pension Plan as listed.
Name Job Classification Department
Pension
Eligibility
Date
Margaux La Barge Customer Service Representative Customer Service 09/02/2017
John Mellor Solid Waste Equipment Operator Solid Waste 09/04/2017
Sara Bayly Customer Service Representative Customer Service 09/05/2017
John Anderson Accountant Gas 09/05/2017
Madai Gutierrez Recreation Specialist Parks and Recreation 09/05/2017
Yiannis Halvatzis Recreation Specialist Parks and Recreation 09/05/2017
Christopher Tisdale Parks Service Technician I Parks and Recreation 09/05/2017
Charles Hargrove Parks Service Technician III Parks and Recreation 09/05/2017
Haris Kasumovic Water Distribution Operator Trainee
Public Utilities 09/05/2017
Tyraven Jackson Water Distribution Operator Trainee Public Utilities 09/05/2017
Kenneth Fluitt, Jr. Solid Waste Equipment Operator Solid Waste 09/05/2017
DeVante Lang Solid Waste Worker Solid Waste 09/16/2017
Eric Saccasyn Fire Inspector II Fire 09/18/2017
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-3919
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 2
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.2
SUBJECT/RECOMMENDATION:
Approve the following request of employee Darci Willis, Public Utilities Department, to vest their
pension as provided by Section 2.419 of the Employees’ Pension Plan.
SUMMARY:
Darci Willis, Wastewater Treatment Plant Operator A, Public Utilities Department, was
employed by the City on October 24, 1998, and began participating in the Pension Plan on that
date. Ms. Willis terminated from City employment on September 8, 2017. The Employees’
Pension Plan provides that should an employee cease to be an employee of the City of
Clearwater or change status from full -time to part-time after completing ten or more years of
creditable service (pension participation ), such employee shall acquire a vested interest in the
retirement benefits. Vested pension payments commence on the first of the month following
the month in which the employee normally would have been eligible for retirement.
Section 2.416 provides for normal retirement eligibility for non -hazardous duty employees hired
prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for
retirement following the earlier of the date on which a participant has reached the age of
fifty-five years and completed twenty years of credited service; the date on which a participant
has reached age sixty -five years and completed ten years of credited service; or the date on
which a member has completed thirty years of service regardless of age. For non -hazardous
duty employees hired on or after the effective date of this restatement, a member shall be
eligible for retirement following the earlier of the date on which a participant has reached the
age of sixty years and completed twenty -five years of credited service; or the date on which a
participant has reached the age of sixty -five years and completed ten years of credited service .
Ms. Willis will meet the non-hazardous duty criteria and begin collecting a pension in November
2018.
Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a
member shall be eligible for retirement following the earlier of the date on which the participant
has completed twenty years of credited service regardless of age, or the date on which the
participant has reached fifty-five years and completed ten years of credited service.
APPROPRIATION CODE AND AMOUNT:
N/A
USE OF RESERVE FUNDS:
N/A
Page 1 City of Clearwater Printed on 11/8/2017
File Number: ID#17-3919
Page 2 City of Clearwater Printed on 11/8/2017
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-3920
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 2
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.3
SUBJECT/RECOMMENDATION:
Approve the following request of employees Dane Heatherington, Engineering Department,
James Hornaday, Gas Department and Anthony Sammartano, Fire Department, for a regular
pension as provided by Sections 2.416 and 2.424 of the Employees’ Pension Plan.
SUMMARY:
Dane Heatherington, Traffic Signal Technician, Engineering Department, was employed by the
City on January 14, 1991, and his pension service credit is effective on that date. His pension
will be effective October 1, 2017. Based on an average salary of approximately $61,630.69 over
the past five years, the formula for computing regular pensions and Mr. Heatherington selection
of the Joint and Survivor Annuity, this pension benefit will be approximately $45,271.20 annually.
James Hornaday, Gas Technician III, Gas Department, was employed by the City on June 13,
1994, and his pension service credit is effective on that date. His pension will be effective
October 1, 2017. Based on an average salary of approximately $55,182.48 over the past five
years, the formula for computing regular pensions and Mr. Hornaday’s selection of the 100%
Joint and Survivor Annuity, this pension benefit will be approximately $28,752.84 annually.
Anthony Sammartano, Fire Lieutenant, Fire Department, was employed by the City on March 3,
1997, and his pension service credit is effective on that date. His pension will be effective
October 1, 2017. Based on an average salary of approximately $109,662.12 over the past five
years, the formula for computing regular pensions and Mr. Sammartano’s selection of the
100% Joint and Survivor Annuity, this pension benefit will be approximately $60,461.52 annually.
Section 2.416 provides for normal retirement eligibility for non -hazardous duty employees hired
prior to the effective date of this reinstatement (January 1, 2013), a member shall be eligible for
retirement following the earlier of the date on which a participant has reached the age of
fifty-five years and completed twenty years of credited service; the date on which a participant
has reached age sixty -five years and completed ten years of credited service; or the date on
which a member has completed thirty years of service regardless of age. For non -hazardous
duty employees hired on or after the effective date of this restatement, a member shall be
eligible for retirement following the earlier of the date on which a participant has reached the
age of sixty years and completed twenty -five years of credited service; or the date on which a
participant has reached the age of sixty -five years and completed ten years of credited service .
Mr. Heatherington and Mr. Hornaday have met the non-hazardous duty criteria.
Section 2.416 provides for normal retirement eligibility for hazardous duty employees, a
member shall be eligible for retirement following the earlier of the date on which the participant
Page 1 City of Clearwater Printed on 11/8/2017
File Number: ID#17-3920
has completed twenty years of credited service regardless of age, or the date on which the
participant has reached fifty -five years and completed ten years of credited service. Mr.
Sammartano has met the hazardous duty criteria.
APPROPRIATION CODE AND AMOUNT:
N/A
USE OF RESERVE FUNDS:
N/A
Page 2 City of Clearwater Printed on 11/8/2017
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-4042
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 1
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.4
SUBJECT/RECOMMENDATION:
Approve the termination of small cap value equity money manager Systematic Financial
Management and authorize the appropriate officials to execute same.
SUMMARY:
Systematic was hired as a small cap value equity manager for the plan in July 2003. As of June
30, 2017, the market value of the plan ’s investment in Systematic ’s small cap value equity
product totaled $12.34 million, or 1.28% of the total investment portfolio. Systematic’s
performance has steadily declined in recent years, as detailed below. The Pension Investment
Committee unanimously recommends termination at this time.
Percentile
As of 6/30/2017 Systematic Ranking Benchmark
Last 3 years 3.21% 99th 7.02%
Last 5 years 12.22% 95th 13.38%
Staff will be bringing a separate agenda item forward for replacement of Systematic in the
small cap value equity investment category.
Page 1 City of Clearwater Printed on 11/8/2017
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This report has been created as a courtesy for the clients of CapTrust Advisors, LLC.
The information contained herein was taken from sources believed to be reliable, but no representation or
warranty is made as to its accuracy or completeness.
Performance Comparison Page Information:
Shaded areas represent where the investment objective was achieved either by:
1) The investment return versus the index;
2) The investment return universe ranking (The lower the number the better the ranking)
Due to methodologies utilized by our systems, the performance results presented are calculated and presented
beginning on the last day of an account's inception month. Results do not include the interim period from an
account's inception date to an account's first month-end. For example, for an account that has an inception
date of March 15, this report begins measuring performance as of March 31. Omission of performance during
this interim period is likely to result in different performance figures than if the interim period's performance
was included in this report.
Prior to January 1st 2016, manager returns were reported both gross and net of fees depending on custody
arrangements and past practices. Effective January 1st 2016, prospectively, all manager returns will be reported
net of fees.
Past performance is no guarantee of future performance.
This report is not the official record of your account. However, it has been prepared to assist you with your
investment planning and is for information purposes only. Your Client Statement is the official record of your
account. Therefore, if there are any discrepancies between this report and your Client Statement, you should
rely on the Client Statement and call your Financial Advisor if you have any questions. Transactions requiring
tax consideration should be reviewed carefully with your accountant or tax advisor. This is not a substitute
for your own records and the year-end 1099 form. Cost data and acquisition dates provided by you are not
verified by CapTrust Advisors, LLC.
Indices are unmanaged and you cannot invest directly in an index.
For index definitions, please see the Capital Markets Review.
11
2
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
Index QTR YTD 1 Yr 3 Yr 5 Yr 10 Yr
Domestic Fixed Income
3 month T-Bill 0.20% 0.31% 0.49% 0.23% 0.17% 0.58%
Barclays Capital 1-3 year Gov't 0.20% 0.48% -0.07% 0.71% 0.65% 2.01%
Barclays Capital Interm Gov't 0.66% 1.20% -1.25% 1.47% 1.07% 3.39%
Barclays Capital Interm Credit 1.38% 2.54% 1.36% 2.60% 2.99% 4.87%
Barclays Capital Interm Govt/Cred 0.94% 1.73% -0.21% 1.92% 1.77% 3.87%
Barclays Capital Aggregate Bond 1.45% 2.27% -0.31% 2.48% 2.21% 4.48%
Domestic Equity
Standard & Poor's 500 3.09% 9.34% 17.90% 9.61% 14.63% 7.18%
Dow Jones Industrial Average 3.95% 9.35% 22.12% 11.01% 13.45% 7.57%
Wilshire 5000 Total Market 2.95% 8.73% 18.54% 9.34% 14.61% 7.29%
Wilshire US REIT 1.78% 1.82% -1.71% 8.30% 9.35% 5.63%
Russell 1000 - Large Cap 3.06% 9.27% 18.03% 9.26% 14.67% 7.29%
Russell 1000 Growth - Large Cap 4.67% 13.99% 20.42% 11.11% 15.30% 8.91%
Russell 1000 Value - Large Cap 1.34% 4.66% 15.53% 7.36% 13.94% 5.57%
Russell Midcap 2.70% 7.99% 16.48% 7.69% 14.72% 7.67%
Russell Midcap Growth 4.21% 11.40% 17.05% 7.83% 14.19% 7.87%
Russell Midcap Value 1.37% 5.18% 15.93% 7.46% 15.14% 7.23%
Russell 2000 - Small Cap 2.46% 4.99% 24.60% 7.36% 13.70% 6.92%
Russell 2000 Growth - Small Cap 4.39% 9.97% 24.40% 7.64% 13.98% 7.82%
Russell 2000 Value - Small Cap 0.67% 0.54% 24.86% 7.02% 13.39% 5.92%
International Equity
MSCI World 4.03% 10.66% 18.20% 5.24% 11.38% 3.97%
MSCI EAFE 6.12% 13.81% 20.27% 1.15% 8.69% 1.03%
MSCI ACWI ex US 5.78% 14.10% 20.45% 0.80% 7.22% 1.13%
MSCI EM 6.27% 18.43% 23.75% 1.07% 3.96% 1.91%
Blended Benchmarks
25% S&P 500 / 5% MSCI EAFE / 70% Barclays Agg 2.09% 4.62% 5.27% 4.20% 5.64% 4.98%
30% S&P 500 / 10% MSCI EAFE / 60% Barclays Agg 2.41% 5.55% 7.21% 4.49% 6.59% 4.94%
35% S&P 500 / 15% MSCI EAFE / 50% Barclays Agg 2.72% 6.48% 9.15% 4.78% 7.53% 4.91%
40% S&P 500 / 20% MSCI EAFE / 40% Barclays Agg 3.04% 7.41% 11.09% 5.07% 8.48% 4.87%
45% S&P 500 / 25% MSCI EAFE / 30% Barclays Agg 3.35% 8.34% 13.03% 5.36% 9.42% 4.83%
3
4.0
4.5
5.0
5.5
6.0
6.5
7.0
150
170
190
210
230
250
270
290
Dec‐13 Jun‐14 Dec‐14 Jun‐15 Dec‐15 Jun‐16 Dec‐16
Non‐Farm Payrolls Added Unemployment Rate
U.S Economic Overview
Labor market solid, while headline inflation slowed
The final look at first-quarter U.S. gross domestic product (GDP) beat expectations and was revised higher,
to a 1.4 percent annualized expansion rate. The change was driven by a rise in personal consumption.
June’s nonfarm payrolls beat expectations, with 222,000 net jobs added (versus expectations of 178,000).
The unemployment rate rose to 4.4 percent. Wages increased 0.2 percent month-over-month and 2.5
percent year-over-year.
Headline inflation slowed, with the Consumer Price Index (CPI) declining by -0.1 percent and slowing to a
1.9 percent year-over-year increase. Excluding the more volatile food and energy components, the CPI rose
0.1 percent for the month and 1.7 percent year-over-year.
June’s Institute for Supply Management (ISM) manufacturing and services surveys both surprised to the
upside. The manufacturing survey increased to 57.8, while the services survey improved to 57.4.
In June, consumer confidence was better than expected, at 118.9, above May’s downward revision. The
present situation component rose to the highest level since 2001, yet future expectations continued their
downward trend after peaking in March.
Housing-market data was mixed. Housing starts and building permits declined by -5.5 and -4.9,
respectively. Existing home sales increased 1.1 percent, to a seasonally-adjusted 5.62-million-unit annual
pace. New home sales rose 2.9 percent, to a seasonally-adjusted annual rate of 610,000 units.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Source: Bloomberg Finance, LLP, 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
Non-Farm Payrolls
(6mo Moving Average in 000s)
Non-Farm Payrolls Have Slowed
Since Their 2014 Highs
Unemployment Rate
ISM Surveys Indicate Solid Economic
Growth in the Second Quarter
PMI Index level
46
48
50
52
54
56
58
60
2013 2014 2015 2016 2017
ISM Manufacturing PMI
4
‐15
‐10
‐5
0
5
10
15
2012 2013 2014 2015 2016 2017
International Economic Overview
Businesses feeling more positive in the Eurozone and Japan
Eurozone economic expansion beat consensus expectations as a final report on first-quarter GDP showed
1.9 percent growth. Business and consumer sentiment also improved, as the Eurozone Markit
Manufacturing Purchasing Managers’ Index (PMI) rose to 57.4 and consumer confidence hit a 10-year
high.
The U.K. outlook remains uncertain as Brexit negotiations begin, particularly following the setback in last
month’s general elections. Nonetheless, the latest measures of U.K. manufacturing and services PMIs were
above 50, signaling expanding activity. While consumer confidence recently has eased, the latest read
remains above lows set 12 months ago.
In Japan, GDP growth remained positive for the past five quarters—its longest stretch in more than a
decade. Recent Japanese industrial production data shows the fastest advance in activity since early 2014.
Business sentiment also remains robust, with the latest Tankan business survey result climbing to its
highest level in three years.
Chinese industrial production slowed to 6.4 percent in May from a high of 8.0 percent in 2014. Following
government reforms, business sentiment weakened as the China Markit Manufacturing PMI Index dipped
below 50 in June, signaling contracting activity. Yet, confidence among Chinese consumers is at its highest
level in more than 20 years.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Source: Bloomberg Finance, LLP, 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
Business Conditions Index
Confidence in Japan at Highest Level Since
Before 2014’s Sales Tax Hike
Eurozone Business and Consumer
Sentiment Have Pushed Higher
PMI Index Level Consumer Confidence Index Level
‐15
‐10
‐5
0
46
48
50
52
54
56
58
Manufacturing PMI Consumer Confidence
5
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Source: Bloomberg Finance, LLP, 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
Stock Market Review and Strategy
Equity asset classes posted positive year-to-date returns
S&P 500 Index returns were positive, up 3.1% for the quarter. Financials were the standouts, followed by
Health Care. The run-up in Financials came as the Federal Reserve (Fed) raised rates last month signaling
stronger sector margins. Information Technology remains this year’s standout sector performer with a year-
to-date (YTD) return of 17.2 percent.
Mid-cap and small-cap equities slightly under- performed large caps for the quarter but produced returns of
2.7 percent and 2.5 percent respectively.
Developed-market (DM) equities continued to show strong returns for the quarter, though they took a
breather in June. Emerging-market (EM) equities held on to solid returns. The dollar depreciated against
DM currencies, boosting returns for U.S. investors. Canada led DMs, while the U.K was weakest, due to
anemic currency performance and political concerns.
Dollar-denominated EM equities gained despite dollar appreciation versus EM currencies. Israel returned
+6.6 percent in U.S.-dollar terms, fueling the 6.1 percent second quarter EM equity gains. South Africa was
weak due to recession concerns.
S&P 500 Sector ReturnsStock Market Total Returns**
Period Ending June 30, 2017
*Annualized returns
**Index returns do not reflect the deduction of fees, expenses or taxes.
CAPITAL MARKETS REVIEW
June 30, 2017
Equity Indexes June QTD YTD 1 Yr 3 Yr
*5 Yr*
MSCI AC World (net)0.5% 4.3% 11.5% 18.8% 4.8% 10.5%
S&P 500 0.6% 3.1% 9.3% 17.9% 9.6% 14.6%
Russell 1000 Growth -0.3% 4.7% 14.0% 20.4% 11.1% 15.3%
Russell 1000 Value 1.6% 1.3% 4.7% 15.5% 7.4% 13.9%
Russell Mid Cap 1.0% 2.7% 8.0% 16.5% 7.7% 14.7%
Russell 2000 3.5% 2.5% 5.0% 24.6% 7.4% 13.7%
MSCI EAFE (net) -0.2% 6.1% 13.8% 20.3% 1.1% 8.7%
MSCI EM (net)1.0% 6.3% 18.4% 23.7% 1.1% 4.0%
MSCI Frontier (net)0.6% 6.1% 15.6% 19.2% -3.4% 8.6%
‐2.9%
‐2.7%
‐2.7%
‐2.3%
‐1.2%
‐0.2%
1.4%
1.9%
1.9%
4.6%
6.4%
‐10.7%
17.2%
8.8%
8.0%
11.0%
‐12.6%
9.5%
9.2%
6.4%
16.1%
6.9%
Telecom
Information Technology
Utilities
Consumer Staples
Consumer Discretionary
Energy
Industrials
Materials
Real Estate
Healthcare
Financials
YTD Jun
6
0
2
4
6
8
10
12
14
16
18
20
Investment Grade High Yield
Emerging Markets
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Barclays Capital, Morningstar 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
Bond Market Review and Strategy
Bond prices subdued
In June the Fed delivered a long-anticipated 25-basis-point rate hike (100 basis points equals 1 percent). The
U.S. dollar remained fairly stable despite major headlines from the U.K. and other international markets.
Domestic bond markets were generally higher for the quarter. Riskier and longer-dated sectors
outperformed (as they have YTD).
Municipals had positive returns for the quarter but declined in June. Many municipal/treasury yield ratios
have fallen to levels near 12-month lows and are less attractive for taxable crossover (and other) buyers.
Headline risk stemming from Illinois’ credit issues has led to some investor concern as well.
Globally, an improved Eurozone economic environment supported peripheral markets. Australian and New
Zealand markets were the top performers, supported by higher yields and firm currencies.
EM bond performance was strong year-to-date but subdued in June. Local currency denominated bonds
gained in dollar terms, mostly from yield Currencies were broadly unchanged against the dollar in
aggregate. Mexico was a strong performer on investor perceptions that rate increases and the peso fall were
coming to an end. Declines in commodity prices weighed on Russia and Colombia.
*Annualized returns
**Index returns do not reflect the deduction of fees, expenses or taxes.
Fixed Income Market Total Returns**
Period Ending June 30, 2017 Credit Spreads to Treasury Securities
Yield Spread (%)
CAPITAL MARKETS REVIEW
June 30, 2017
Fixed Income Indexes June QTD YTD 1 Yr 3 Yr
*5 Yr*
Global Multiverse -0.1% 2.6% 4.6% -1.4% -0.2% 1.1%
U.S. Aggregate -0.1% 1.4% 2.3% -0.3% 2.5% 2.2%
U.S. Treasury Bills 0.1% 0.2% 0.3% 0.4% 0.2% 0.1%
U.S. Short-Term Taxable 0.0% 0.3% 0.7% 0.4% 1.0% 1.0%
U.S. Interm-Term Taxable -0.4% 1.1% 1.8% -0.4% 2.2% 2.1%
U.S Long-Term Taxable 0.8% 4.3% 5.8% -1.3% 5.2% 4.0%
U.S. Treasury -0.2% 1.2% 1.9% -2.3% 2.0% 1.3%
U.S. Corporate 0.3% 2.5% 3.8% 2.3% 3.6% 4.0%
U.S. Municipal -0.4% 2.0% 3.6% -0.5% 3.3% 3.3%
U.S. TIPS -0.9% -0.4% 0.9% -0.6% 0.6% 0.3%
U.S. High Yield 0.1% 2.2% 4.9% 12.8% 4.5% 6.9%
Developed ex. U.S.-0.3% 3.5% 5.6% -5.7% -2.0% -0.9%
Emerging Market -0.3% 2.2% 6.2% 5.5% 4.6% 5.2%
7
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Bloomberg Finance LLP, Morningstar, 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
Real Assets Review and Strategy
Collapse of oil prices hurt commodities
Domestic real estate remained strong for the quarter. Broad-based commodity indices and master limited
partnerships (MLPs) had losses for the quarter, both adversely affected by the collapse in oil prices.
International real estate investment trusts (REITs) have benefited from improving investor confidence and
relatively lower U.S. growth expectations. Domestic REITs benefited from largely upbeat economic news.
Interest rates remain the main risk for public real estate.
MLPs were down over 6 percent for the quarter due to falling oil prices. Oil prices rebounded significantly
in late June, and MLPs ended the month of June with only a slight loss.
Commodities lagged other asset classes for the quarter. Prices got some support from a weak dollar, but
precious metals and energy commodities brought the major indices negative. Crude-oil and natural-gas
demand failed to keep up with production.
*Annualized returns
**Index returns do not reflect the deduction of fees, expenses or taxes.
Real Asset Total Returns**
Period Ending June 30, 2017
Crude Oil vs. Gold
0
200
400
600
800
1000
1200
1400
1600
1800
2000
20
40
60
80
100
120
140
160
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Crude Oil Gold
Oil Price per Barrel (US$) Gold Price per Ounce (US$)
CAPITAL MARKETS REVIEW
June 30, 2017
REIT/Commodity
Indexes June QTD YTD 1 Yr 3 Yr
*5 Yr*
Public Real Estate 0.9% 3.0% 5.4% 1.1% 4.6% 8.4%
U.S. REITs 2.0% 2.3% 4.9% 0.2% 8.9% 10.0%
International REITs -0.8% 5.0% 10.1% 6.0% 1.4% 7.4%
S&P GSCI Commodity -1.9% -5.5% -10.2% -9.0% -24.8% -13.7%
Bloomberg Commodity -0.2% -3.0% -5.3% -6.5% -14.8% -9.2%
RICI Commodity -0.4% -4.1% -5.8% -3.6% -16.5% -8.8%
MLPs -0.6% -6.4% -2.7% 0.4% -11.2% 1.8%
8
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Bloomberg Finance LLP., Cambridge Associates, 7/10/17
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
Alternatives Review and Strategy
Decline in oil hurt macro strategy
Relative Value: Relative Value showed slightly positive returns for the quarter. Legacy commercial
mortgage-backed securities continue to mature and pay down principal, with defaults well below
expectations from just a few months ago.
Macro: It was a challenging quarter for many Macro managers, especially those that had short positions on
volatility ahead of the nearly 50 percent jump in the CBOE Volatility Index® (VIX®) on June 29. Sharp
moves in oil were challenging for both Discretionary and Systematic Macro strategies.
Event Driven: While corporate deal activity remained healthy and quarterly returns were positive, June was
a good reminder that not all deals end as planned. A high visibility drug-store-chain merger agreement was
scuttled due to heavy antitrust scrutiny. Offsetting this was a $6.9 billion private-equity-firm acquisition of
an office-supply chain that was the largest leveraged buyout of the year.
Equity Hedge: Equity Hedge had strong returns for the quarter, up 2.3 percent. Gross leverage reached
levels not seen since 2007. Managers were quick to reduce portfolio risk in June. Managers also reduced
exposure to Energy and Health Care, while adding to Technology names.
*Annualized returns
**Index returns do not reflect the deduction of fees, expenses or taxes.
AlternativesTotal Returns**
Period Ending June 30, 2017
U.S. Private Equity Index Returns
Quarterly Change (%)
CAPITAL MARKETS REVIEW
June 30, 2017
Alternative Indexes June QTD YTD 1 Year 3 Year
*5 Year*
Global Hedge Funds 0.4% 1.1% 3.7% 8.0% 2.6% 4.9%
Relative Value 0.3% 0.6% 2.9% 7.9% 3.1% 5.5%
Arbitrage 0.0% 0.4% 3.4% 5.2% 2.7% 3.4%
Long/Short Credit 0.1% 0.9% 3.1% 10.1% 3.0% 5.1%
Struct Credit/Asset Backed 0.6% 1.9% 4.6% 10.1% 4.8% 7.9%
Macro -1.0% -0.7% -0.8% -2.5% 1.1% 1.0%
Systematic -2.2% -1.6% -2.8% -7.7% 1.1% 0.2%
Discretionary 0.0% 0.0% 0.7% 2.0% -0.3% 0.8%
Event Driven 0.7% 1.8% 4.3% 12.8% 2.5% 6.1%
Activist 1.3% 2.6% 4.2% 16.5% 6.4% 11.4%
Distressed Credit 0.1% 0.6% 3.2% 14.8% 0.7% 5.7%
Merger Arbitrage 0.9% 2.2% 3.1% 6.8% 3.3% 3.6%
Equity Hedge 1.2% 2.3% 6.2% 12.5% 3.0% 6.3%
Directional Equity 1.4% 2.8% 5.5% 11.1% 3.3% 6.5%
Equity Market Neutral 0.0% -0.5% 0.7% 2.8% 2.9% 3.8%
9
Russell 1000 Value contains those Russell 1000 (larger capitalization) securities with a less-than-average growth orientation.
Securities in this index generally have lower price-to-book and price-to-earnings ratios, higher dividend yields, and lower
forecasted growth rates.
Russell 1000 Growth contains those Russell 1000 (larger capitalization)securities with a greater-than-average growth
orientation. Securities in this index generally have higher price-to-book and price-to-earnings ratios, lower dividend yields,
and higher forecasted growth rates.
Russell 2000 Value contains those Russell 2000 (smaller capitalization) securities with a less-than-average growth
orientation. Securities in this index generally have lower price-to-book and price-to-earnings ratios than those in the Russell
2000 Growth Index.
Russell 2000 Growth contains those Russell 2000 (smaller capitalization) securities with a greater-than-average growth
orientation. Securities in this index generally have higher price-to-book and price-to-earnings ratios than those in the Russell
2000 Value Index.
MSCI EAFE is the Morgan Stanley Capital International Europe, Australia, Far East Index designed to measure the
performance of developed stock markets in these areas.
Barclays Agg Bond is the Barclays Capital Aggregate Bond Index. This index includes U.S. government, corporate and
mortgage-backed securities rated investment grade or higher with maturities up to 30 years.
S&P 500 is a representative sample of 500 leading companies in leading industries of the U.S. economy.
DJ Wilshire REIT is intended as a broad measure of the performance of publicly traded real estate equity. The index is
comprised of companies whose charter is the equity ownership and operation of commercial real estate.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Russell Russell DJ Russell Barclays Russell DJ DJ DJ Russell Barclays Russell Russell DJ Russell Russell DJ Russell Russell Russe ll
BEST 1000 2000 Wilshire 2000 Agg 2000 Wilshire Wilshire Wilshire 1000 Agg 1000 2000 Wilshire 2000 2000 Wilshire 1000 2000 1000
Growth Growth REIT Value Bond Growth REIT REIT REIT Growth Bond Growth Growth REIT Value Growth REIT Growth Value Growth
38.71% 43.09% 31.04% 13.96% 10.27% 48.53% 33.14% 14.00% 36.13% 11.81% 5.24% 37.21% 29.09% 9.37% 18.05% 43.30% 31.78% 5.67% 31.74% 13.99%
Russell Russell DJ DJ Russell Russell Russell Russell DJ Barclays Russell Russell DJ Russell
1000 2000 Wilshire Wilshire 2000 2000 2000 2000 Wilshire Agg 1000 2000 Wilshire 1000
Growth Value REIT REIT Value Value Value Growth REIT Bond Value Value REIT Value
28.57%33.16% 22.83% 12.36% 3.60% 46.02% 22.25% 13.54% 26.34% 11.17% -28.92% 34.47% 28.07% 7.84%17.51%34.52%13 .6 9 %4.23%17.3 4 %13 .8 1%
Barclays Barclays Russell Russell Russell Russell Russell Russell Russell Russell Russell Russell
Agg Agg 2000 1000 2000 2000 1000 2000 1000 1000 1000 2000
Bond Bond Value Value Value Growth Value Value Growth Growth Value Growth
20.33% 27.30% 11.63% 8.44% -11.42% 39.16% 20.25%7.05%23.48% 7.05%-36.85%31.78% 24.50% 2.64% 17.32% 33.48%13 .4 5% 1.3 8 % 11.9 6 %9.97%
Russell Russell Russell Russell DJ Russell Russell Russell Barclays DJ Russell DJ Russell Russell Barclays Russell
1000 1000 1000 1000 Wilshire 1000 1000 1000 Agg Wilshire 1000 Wilshire 1000 1000 Agg 2000
Value Value Value Value REIT Value Growth Value Bond REIT Growth REIT Value Growth Bond Growth
15.63% 21.04% 7.01% -5.59% -15.52%36.06%16.49%5.26%22.25%6.97%-37.00%2 8 .4 6 % 16 .71%2 .11%17.12 %32.53%13.05% 0.55% 11.32%9.34%
Barclays Russell Russell Russell Russell Russell Russell Russell Barclays DJ Russell
Agg 10 0 0 2000 10 0 0 2000 1000 1000 1000 Ag g Wilshire 10 0 0
Bond Value Growth Value Growth Growth Value Value Bond REIT Value
8.67%7.35% -9.10%-9.22% -15.94%30.03%14 .3 1%4.91% 15.79% 5.49%-38.44%26.46% 15.51% 0.39% 16.00% 32.39%5.97% -0.81% 7.24%4.66%
Russell DJ Russell Russell Russell Russell Russell Russell Russell Russell Russell Russell Russell Barclays
2000 Wilshire 1000 2000 2000 10 0 0 2000 2000 2000 1000 2000 2000 1000 Agg
Growth REIT Growth Value Growth Value Growth Value Growth Growth Growth Growth Growth Bond
1.23% -2.57% -13.96%-11.88% -22.09%29.76%10 .8 7%4.71% 13.35%-0.17%-38.54% 20.58%15.06%-2.91% 15.26% 23.29% 5.60% -1.38% 7.08% 2.27%
Russell Barclays Russell Russell Russell Russell Russell Russell Russell DJ Russell Russell Russell DJ Russell Russell Barclays DJ
2000 Agg 1000 1000 1000 1000 2000 1000 2000 Wilshire 1000 2000 2000 Wilshire 2000 10 0 0 Agg Wilshire
Value Bond Growth Growth Growth Growth Growth Growth Value REIT Value Value Growth REIT Value Value Bond REIT
-6.46% -0.83% -22.42% -20.42% -27.89%28.67%6.30% 4.15% 9.07% -9.78% -39.20%19.69%7.75% -5.50% 14.59% 1.86% 4.22%-3.83%2.65% 1.82%
DJ Russell Russell Russell Barclays Barclays Barclays Barclays DJ Barclays Barclays Barclays Barclays Russell Russell
Wilshire 2000 2000 2000 Agg Agg Agg Agg Wilshire Agg Agg Agg Agg 2000 2000
WORS T
REIT Value Growth Growth Bond Bond Bond Bond REIT Bond Bond Bond Bond Value Value
-17.00% -1.49% -22.43% -22.00% -30.27% 4.11% 4.34% 2.43% 4.33% -17.56% -45.09% 5.93% 6.54% -12.14% 4.22% -2.02% -4.48% -7.47% 1.00% 0.54%
S&P
500
MSCI
EAFE
MSCI
EAFE
MSCI
EAFE
S&P
500
MSCI
EAFE
S&P
500
S&P
500
MSCI
EAFE
S&P
500
MSCI
EAFE
MSCI
EAFE
MSCI
EAFE
S&P
500
MSCI
EAFE
S&P
500
S&P
500
S&P
500
MSCI
EAFE
S&P
500
S&P
500
S&P
500
MSCI
EAFE
S&P
500
MSCI
EAFE
MSCI
EAFE
S&P
500
S&P
500
MSCI
EAFE
MSCI
EAFE
MSCI
EAFE
MSCI
EAFE
S&P
500
MSCI
EAFE
S&P
500
S&P
500
S&P
500
MSCI
EAFE
S&P
500
MSCI
EAFE
10
-60
-40
-20
0
20
40
60
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Domestic Equity vs. Fixed Income Mean 1 Standard Deviation 2 Standard Deviations
Fixed Income Outperforming
Domestic Equity OutperformingDomestic Equity vs. Fixed Income
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
Invasion of Iraq
Asian CrisisBlack Monday - Oct '87
Aug '82 –DJIA 776
CAPITAL MARKETS REVIEW
June 30, 2017
RELATIVE PERFORMANCE OF KEY INDICES
-60
-40
-20
0
20
40
60
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Domestic Equity vs. Foreign Equity Mean 1 Standard Deviation 2 Standard Deviations
Foreign Equity Outperforming
Domestic Equity OutperformingDomestic Equity vs. Foreign Equity
11
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
RELATIVE PERFORMANCE OF KEY INDICES
-40
-20
0
20
40
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Large Cap vs. Small Cap Mean 1 Standard Deviation 2 Standard Deviations
Small Cap Outperforming
Large Cap OutperformingLarge Cap vs. Small Cap
-60
-40
-20
0
20
40
60
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Large Value vs. Large Growth Mean 1 Standard Deviation 2 Standard Deviations
Growth Outperforming
Value OutperformingLarge Value vs. Large Growth
12
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
RELATIVE PERFORMANCE OF KEY INDICES
-60
-40
-20
0
20
40
60
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Small Value vs. Small Growth Mean 1 Standard Deviation 2 Standard Deviations
Growth Outperforming
Value OutperformingSmall Value vs. Small Growth
Growth Outperforming
Value Outperforming
-80
-60
-40
-20
0
20
40
60
80
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Domestic Equity vs. REIT Mean 1 Standard Deviation 2 Standard Deviations
REIT Outperforming
Domestic Equity OutperformingDomestic Equity vs. REIT
13
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
Data Sources: Morningstar
Data provided by sources believed to be reliable but no guarantee is made as to its accuracy. Past performance is no guarantee of future performance.
CAPITAL MARKETS REVIEW
June 30, 2017
RELATIVE PERFORMANCE OF KEY INDICES
-120
-100
-80
-60
-40
-20
0
20
40
60
80
100
120
12/79 - 12/8012/80 - 12/8112/81 - 12/8212/82 - 12/8312/83 - 12/8412/84 - 12/8512/85 - 12/8612/86 - 12/8712/87 - 12/8812/88 - 12/8912/89 - 12/9012/90 - 12/9112/91 - 12/9212/92 - 12/9312/93 - 12/9412/94 - 12/9512/95 - 12/9612/96 - 12/9712/97 - 12/9812/98 - 12/9912/99 - 12/0012/00 - 12/0112/01 - 12/0212/02 - 12/0312/03 - 12/0412/04 - 12/0512/05 - 12/0612/06 - 12/0712/07 - 12/0812/08 - 12/0912/09 - 12/1012/10 - 12/1112/11-12/1212/12-12/1312/13-12/1412/14-12/15Fixed Income vs. REIT Mean 1 Standard Deviation 2 Standard Deviations
REIT Outperforming
Fixed Income OutperformingFixed Income vs. REIT
14
FIRM:Wells Fargo Advisors is the trade name used by two separate, registered broker/dealers and nonbank affiliates of
Wells Fargo & Company, providing certain retail securities brokerage services: Wells Fargo Advisors, LLC., member
FINRA, SIPC, and Wells Fargo Financial Network, LLC, member FINRA, SIPC. Investments in securities and insurance
products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE.
CONFLICTS OF INTEREST:To review important information about certain relationships and potential conflicts of
interest that may exist between Wells Fargo Advisors , its affiliates, and the companies that are mentioned in this report,
please visit the our research disclosure page at www.wellsfargoadvisors.com/gotoresearchdisclosures or call your
Financial Advisor.
STATEMENT OF OPINION: This and/or the accompanying information was prepared by or obtained from sources
which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy. Any opinions expressed or
implied herein are not necessarily the same as those of Wells Fargo Advisors or its affiliates and are subject to change
without notice. The report herein is not a complete analysis of every material fact in respect to any company, industry or
security. Any market prices are only indications of market values and are subject to change. The material has been
prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or
instrument or to participate in any trading strategy. Additional information is available upon request.
ASSET CLASS SUITABILITY:Stocks of small companies are typically more volatile than stocks of larger companies.
They often involve higher risks because they may lack the management expertise, financial resources, product
diversification and competitive strengths to endure adverse economic conditions. High-yield, non-investment grade bonds
are only suitable for aggressive investors willing to take greater risks, which could result in loss of principal and interest
payments. Global/International investing involves risks not typically associated with US investing, including currency
fluctuations, political instability, uncertain economic conditions and different accounting standards.
PAST PERFORMANCE:Past performance is not an indication of future results.
ASSET CLASS PERFORMANCE REPRESENTATIONS:Long Term Treasuries = BC Treasury Long; Municipals =
BC Municipal; Foreign Bonds = Salomon World BIG – IB; US Govt/Credit = BC Govt/Credit; Mtge Backed Securities =
ML Mortgage Master; Corporate Bonds = Salomon Corporate; 90 Day T-Bills = Salomon; Japanese Stocks = Salomon
Japan BMI; High Yield Bonds = ML High Yield Master; Small Cap US Value = RU 2000 Value; MidCap US Stocks =
RU Midcap; Large Cap US Value = RU 1000 Value; European Stocks = Salomon Europe BMI; Small Cap US Stocks =
RU 2000; Lg Cap US Growth = RU 1000 Growth; Latin American Stocks = Salomon Latin America BMI; Sm Cap US
Growth = RU 2000 Growth
BROAD EQUITY MARKET & SECTOR PERFORMANCE REPRESENTATIONS: Large-Cap = S&P 500 or
Russell 1000; Mid-Cap = RU Midcap; Small-Cap = RU 2000; International = MSCI EAFE
DATA SOURCES:Information found in this document was derived from the following sources: Zephyr Associates
StyleAdvisor, Informa M-Watch, Investor Force, Barclays Capital, MSCI Barra, Standard & Poor’s, and Morningstar.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
CAPITAL MARKETS REVIEW
June 30, 2017
GENERAL DISCLOSURE STATEMENT
15
Dow Jones Industrial Average - This index is comprised of 30 "blue-chip" US stocks selected for their history of
successful growth and wide interest among investors. The DJIA represents about 20% of the total market value of all US
stocks and about 25% of the NYSE market capitalization. It is a price-weighted arithmetic average, with the divisor
adjusted to reflect stock splits and the occasional stock switches in the index.
NASDAQ Composite - A cap-weighted index comprised of all common stocks that are listed on the NASDAQ Stock
Market (National Association of Securities Dealers Automated Quotation system).
S&P 500 - A broad-based measurement of changes in stock market conditions based on the average performance of 500
widely held common stocks. This index does not contain the 500 largest companies nor the most expensive stocks traded
in the U.S. While many of the stocks are among the largest, this index also includes many relatively small companies. This
index consists of approximately 380 industrial, 40 utility, 10 transportation and 70 financial companies listed on U.S.
market exchanges. It is a capitalization-weighted index (stock price times number of shares outstanding), calculated on a
total return basis with dividends reinvested.
S&P 500/Citigroup Growth - The S&P/Citigroup Growth tracks the performance of those stocks in the S&P 500 with
lower book-to-price ratios. A cap-weighted index, it is rebalanced semi-annually, based on its price-to-book ratios and
market capitalizations at the close of trading one month prior. The index is adjusted each month to reflect changes in the
S&P 500. This index is more heavily weighted in the consumer non-cyclical, health care, and technology sectors than the
S&P 500.
S&P 500/Citigroup Value - The S&P Citigroup/Value tracks the performance of those stocks in the S&P 500 with higher
book-to-price ratios. A cap-weighted index, it is rebalanced semi-annually on January 1 and July 1, based on its book-to-
price ratios and market capitalizations at the close of trading one month prior. The index is adjusted each month to reflect
changes in the S&P 500. This index tends to be more heavily concentrated in the energy and financial sectors than the
S&P 500.
Russell 1000 - The 1000 largest companies in the Russell 3000 index, based on market capitalization.
Russell 1000 Growth - A segment of the Russell 1000 with a greater-than-average growth orientation. Companies in this
index have higher price-to-book and price-earnings ratios, lower dividend yields and higher forecasted growth values than
the Russell 1000 Value index.
Russell 1000 Value - Represents a segment of the Russell 1000 with a less-than-average growth orientation. Companies
in this index have low price-to-book and price-earnings ratios, higher dividend yields and lower forecasted growth values
than the Russell 1000 Growth Index.
Russell Mid Cap - The index consisting of the bottom 800 securities in the Russell 1000 as ranked by total market
capitalization, and it represents over 35% of the Russell 1000 total market cap.
Russell 2000 - The 2000 smallest companies in the Russell 3000 index.
Russell 2000 Growth - A segment of the Russell 2000 with a greater-than-average growth orientation. Companies in this
index have higher price-to-book and price-earnings ratios, lower dividend yields and higher forecasted growth values than
the Russell 2000 Value index.
Russell 2000 Value - A segment of the Russell 2000 with a less-than-average growth orientation. Companies in this index
have low price-to-book and price-earnings ratios, higher dividend yields and lower forecasted growth values than the
Russell 2000 Growth index.
Russell 2500 - The index consisting of the bottom 500 stocks in the Russell 1000(as ranked by market capitalization) and
all of the stocks in the Russell 2000. This index is intended to be used as a measure of small to medium/small stock
performance, and it represents over 22% of the Russell 3000 total market cap.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
CAPITAL MARKETS REVIEW
June 30, 2017
GENERAL DISCLOSURE STATEMENT
16
MSCI EAFE - A market capitalization-weighted index representing all of the MSCI developed markets outside North
America. It comprises 20 of the 22 countries in the MSCI World. These 20 countries include the 14 European countries in
the MSCI Europe and the 6 Pacific countries in the MSCI Pacific. This index is created by aggregating the 20 different
country indexes, all if which are created separately.
MSCI World - This market capitalization-weighted index represents all 22 of the MSCI developed markets in the world.
It is created by aggregating the 22 different country indexes, all if which are created separately.
MSCI Emerging Markets Free (EMF)- A market capitalization-weighted index representing 26 of the emerging
markets in the world. Several factors are used to designate whether a country is considered to be emerging vs. developed,
the most common of which is Gross Domestic Product Per Capita. The "Free" aspect indicates that this index includes
only securities that are allowed to be purchased by global investors. This index is created by aggregating the 26 different
country indexes, all if which are created separately.
Barclays Capital Government/Credit - This index includes all bonds that are in the Barclays Capital Government Bond
and the Barclays Capital Credit Bond indices.
Barclays Capital Government Intermediate - All bonds covered by the Barclays Capital Government Bond index with
maturities of 1 and 10 years.
Barclays Capital Aggregate Bond - This index is made up of the Barclays Capital Government/Credit, the Mortgage-
Backed Securities, and the Asset-Backed Securities indices.All issues in the index are rated investment grade or higher,
have at least one year to maturity, and have an outstanding par value of at least $100 million.
Barclays Capital Government Long Term - All bonds covered by the Barclays Capital Government Bond index with
maturities of 10 years or greater.
Barclays Capital Municipal Bond - This market cap weighted index includes investment grade tax-exempt bonds and is
classified into four main sectors: General Obligation, Revenue, Insured, and Pre-refunded. To be included in this index,
the original transaction size of a bond must have been greater than $50 million.
Merrill Lynch Convertibles - The convertible securities used in this index span all corporate sectors and must have a par
amount outstanding of $25 million or more. The maturity must be at least one year. The coupon range must be equal to or
greater than zero and all quality of bonds are included. Excluded from this index are preferred equity redemption stocks.
When the component bonds of this index convert into common stock, the converted securities are dropped from the index.
Merrill Lynch High Yield Master - Market-cap weighted index providing a broad-based measure of bonds in the US
domestic bond market rated below investment grade but not in default. Includes only issues with a credit rating of BB1 or
below as rated by Moody’s and/or S&P, at least $100 million in face value outstanding and a remaining term to final
maturity equal to or greater than one year.
Dow Jones Wilshire REIT Index - A measurement of equity REITs and Real Estate Operating Companies. No special-
purpose or health care REITs are included. It is a market capitalization-weighted index for which returns are calculated
monthly using buy and hold methodology; it is rebalanced monthly.
Citigroup3MonthTreasuryBill- Representing the monthly return equivalents of yield averages that are not marked to
market, this index is an average of the last three three-month Treasury bill issues.
50/50 Blend (S&P 500/BCIGC)– A blended benchmark consisting of 50% S&P 500 and 50% Barclays Capital
Government/Credit Intermediate indices.
This and/or the accompanying information was prepared by or obtained from sources which Wells Fargo Advisors believes to be reliable but does not guarantee its accuracy.
Please see important disclosure and reference information at the conclusion of this report. Past performance is not indicative of future results.
CAPITAL MARKETS REVIEW
June 30, 2017
GENERAL DISCLOSURE STATEMENT
17
18
City of Clearwater Employees Pension Fund
Asset Allocation vs Target & Policy
Total Fund
As of 6/30/17
Manager
Market
Value Actual %Policy %
Voya Investment Mgmt
NTGI-QM R1000V
Eagle Capital Management
Manning and Napier
Artisan Partners
Wedge Capital Mgmt
Atlanta Capital Mgmt
Systematic Financial Mgt
Riverbridge Partners
Total Domestic Equity
Eaton Vance Mgmt
WCM Investment Management
Thompson, Siegel & Walmsley
Total International Equity
Dodge & Cox
Western Asset Management Co.
Security Lending Income Account
In House Account
Total Domestic Fixed Income
Multi Employer Property Trust
Security Capital
Molpus Woodlands Group
Hancock
USAA
U.S. Real Estate Investment Fund
Total Real Estate
Total Fund
128,772,224.55
44,191,896.26
44,307,388.23
39,205,062.86
42,468,383.69
38,437,302.09
13,033,467.20
12,343,928.69
27,587,981.46
390,347,635.03
36,446,616.13
76,720,977.71
76,992,986.39
190,160,580.23
127,420,967.40
127,765,914.21
533,052.81
1,266,007.55
256,985,941.97
45,267,168.80
37,586,948.09
11,915,495.00
8,325,723.00
10,896,411.69
11,375,139.00
125,366,885.58
962,861,042.81
13.37
4.59
4.60
4.07
4.41
3.99
1.35
1.28
2.87
40.54
3.79
7.97
8.00
19.75
13.23
13.27
0.06
0.13
26.69
4.70
3.90
1.24
0.86
1.13
1.18
13.02
100.00
39.00
18.00
28.00
15.00
19
City of Clearwater Employees Pension Fund
Sources of Fund Growth
Total Fund
3/31/17 - 6/30/17
Manager Name
Beginning
Value
Net
Contrib
Invest
Fees
Invest
Gain/Loss
Ending
Value
Voya Investment Mgmt
NTGI-QM R1000V
Eagle Capital Management
Manning and Napier
Artisan Partners
Wedge Capital Mgmt
Atlanta Capital Mgmt
Systematic Financial Mgt
Riverbridge Partners
Equity
Earnest Partners CLOSED
Eaton Vance Mgmt
WCM Investment Management
Thompson, Siegel & Walmsley
International EQ Comp
Dodge & Cox
Western Asset Management Co.
Security Lending Income Account
In House Account
Fixed Income Comp
Multi Employer Property Trust
Security Capital
Molpus Woodlands Group
Hancock
USAA
U.S. Real Estate Investment Fund
Real Estate Comp
Total Fund
123,054,077
43,584,704
42,624,257
38,006,112
39,681,482
37,171,908
12,602,106
12,422,411
25,302,131
374,449,187
5,413
35,096,682
70,065,800
72,499,597
177,667,492
125,723,872
125,874,546
372,616
12,212,572
264,183,606
44,628,618
37,231,997
11,915,495
8,393,734
10,957,199
11,242,001
124,369,045
940,669,331
127,950
4,358
85,674
62,892
84,348
59,216
25,872
30,764
61,669
542,743
-5,449
0
113,282
196,330
304,162
65,158
84,088
159,337
-10,946,564
-10,637,982
0
60,358
0
-68,011
0
0
-7,653
-9,798,729
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
5,590,198
602,833
1,597,458
1,136,058
2,702,554
1,206,178
405,490
-109,247
2,224,181
15,355,704
NA
1,349,934
6,541,896
4,297,059
12,188,889
1,631,938
1,807,281
1,100
0
3,440,318
638,551
294,593
0
0
-60,788
133,138
1,005,494
31,990,441
128,772,225
44,191,896
44,307,388
39,205,063
42,468,384
38,437,302
13,033,467
12,343,929
27,587,981
390,347,635
NA
36,446,616
76,720,978
76,992,986
190,160,580
127,420,967
127,765,914
533,053
1,266,008
256,985,942
45,267,169
37,586,948
11,915,495
8,325,723
10,896,412
11,375,139
125,366,886
962,861,043
20
City of Clearwater Employees Pension Fund
Executive Summary Table
Periods Ending June 30, 2017
Net of Fee Return
Name
Value
$(000)
Periods Ending 6/30/17
Cur Qtr 1 Year 3 Yrs 5 Yrs 7 Yrs 10 Yrs 15 Yrs
Since Inception
Ret Date
Total Fund
Policy Index
Secondary Benchmark
Domestic Equity Comp
S&P 500
Large Cap Equity Comp
R1000
Eagle Capital Management
Russell 1000 Value
Manning and Napier
Russell 1000 Value
NTGI-QM R1000V
R1000V
Voya Investment Mgmt
R1000G
Mid Cap Equity Comp
R Mid Cap
Artisan Partners
R Mid Cap G
Wedge Capital Mgmt
R Mid Cap V
Small Cap Equity Comp
R2000
Atlanta Capital Mgmt
Russell 2000
Riverbridge Partners
R2000G
Systematic Financial Mgt
R2000V
International EQ Comp
MSCI ACWI ex US (Net)
Eaton Vance Mgmt
MSCI Emg Mkts
Thompson, Siegel & Walmsley
MSCI EAFE (Net)
WCM Investment Management
MSCI ACWI ex US (Net)
962,861
390,348
256,477
44,307
39,205
44,192
128,772
80,906
42,468
38,437
52,965
13,033
27,588
12,344
190,161
36,447
76,993
76,721
3.41
3.04
2.87
4.10
3.09
3.61
3.06
3.75
1.34
2.99
1.34
1.38
1.34
4.54
4.67
5.09
2.70
6.81
4.21
3.24
1.37
5.01
2.46
3.22
2.46
8.79
4.39
-0.88
0.67
6.86
5.78
3.85
6.38
5.92
6.12
9.34
5.78
11.85
10.44
11.34
19.49
17.90
19.14
18.03
23.41
15.53
15.99
15.53
15.36
15.53
20.09
20.42
18.53
16.48
17.20
17.05
19.68
15.93
22.85
24.60
14.15
24.60
28.26
24.40
22.85
24.86
18.40
20.45
17.69
24.17
20.32
20.26
17.14
20.45
6.25
5.91
9.34
9.61
10.00
9.26
10.19
7.36
8.24
7.36
7.38
7.36
11.31
11.11
8.29
7.69
7.18
7.83
9.29
7.46
8.54
7.36
10.47
7.36
10.09
7.64
3.21
7.02
-1.43
1.21
-1.16
1.44
9.75
9.03
14.85
14.63
14.98
14.67
14.12
13.94
15.36
15.30
14.98
14.72
13.70
14.20
16.06
15.14
14.04
13.70
15.27
13.94
14.16
13.98
12.22
13.38
5.11
8.91
3.25
4.33
10.50
10.08
15.72
15.41
15.28
15.43
14.27
14.31
16.71
16.48
16.42
15.28
16.38
15.24
16.33
15.29
16.09
14.35
17.04
13.89
13.48
13.50
5.46
8.22
3.54
4.22
6.72
5.86
8.14
7.18
7.53
7.29
5.62
5.56
9.61
8.91
9.19
7.67
10.02
7.87
9.09
7.23
8.15
6.92
11.83
6.18
5.70
5.92
0.83
1.38
7.74
7.96
9.45
8.34
8.60
8.62
9.71
9.03
10.74
10.50
11.43
10.34
5.76
6.70
9.19
9.27
11.27
10.48
10.53
10.47
14.41
12.28
11.99
12.28
5.62
5.56
11.74
10.13
12.51
11.70
9.91
8.10
9.41
7.48
10.07
9.30
12.51
9.34
15.52
13.71
8.66
9.14
4.79
5.33
0.69
0.97
2.80
3.01
8.80
4.31
12/31/87
12/31/87
12/31/15
12/31/87
12/31/87
3/31/88
3/31/88
1/31/13
1/31/13
1/31/13
1/31/13
6/30/07
6/30/07
12/31/87
12/31/87
3/31/88
3/31/88
7/31/01
7/31/01
2/28/07
2/28/07
8/31/03
8/31/03
8/31/03
8/31/03
9/30/10
9/30/10
8/31/03
8/31/03
5/31/01
5/31/01
4/30/08
4/30/08
7/31/15
7/31/15
7/31/15
7/31/15
21
City of Clearwater Employees Pension Fund
Executive Summary Table
Periods Ending June 30, 2017
Net of Fee Return
Name
Value
$(000)
Periods Ending 6/30/17
Cur Qtr 1 Year 3 Yrs 5 Yrs 7 Yrs 10 Yrs 15 Yrs
Since Inception
Ret Date
Fixed Income Comp
BC Agg
Dodge & Cox
BC Agg
In House Account
3-month T-Bill
Security Lending Income Account
3-month T-Bill
Western Asset Management Co.
BC Agg
Real Estate Comp
Policy Index
Hancock
NCREIF Timberland Index
Molpus Woodlands Group
NCREIF Timberland Index
Multi Employer Property Trust
NCREIF ODCE
Security Capital
Wilshire RESI
U.S. Real Estate Investment Fund
NCREIF ODCE Fund Index
USAA
NCREIF ODCE Fund Index
256,986
127,421
1,266
533
127,766
125,367
8,326
11,915
45,267
37,587
11,375
10,896
1.31
1.45
1.30
1.45
0.00
0.18
0.27
0.18
1.44
1.45
0.81
1.84
0.00
0.70
0.00
0.70
1.43
1.70
0.79
1.91
1.18
1.70
-0.55
1.70
1.57
-0.31
2.62
-0.31
0.00
0.46
2.13
0.46
0.33
-0.31
3.15
1.72
-0.66
3.35
1.01
3.35
6.16
7.87
-2.52
-1.23
12.13
7.87
9.57
7.87
3.08
2.48
3.08
2.48
0.00
0.20
3.56
0.20
2.91
2.48
7.92
9.81
2.56
5.54
3.06
5.54
9.82
11.34
7.83
8.82
3.18
2.21
3.61
2.21
-0.00
0.15
3.60
0.15
2.61
2.21
8.65
10.53
4.80
7.16
5.29
7.16
9.50
11.78
8.93
9.70
3.94
3.19
4.27
3.19
-0.00
0.13
4.71
0.13
3.51
3.19
11.84
13.59
12.53
13.50
5.21
4.48
5.41
4.48
-0.00
0.51
6.73
0.51
4.88
4.48
4.99
4.48
-0.00
1.23
6.31
6.43
4.95
4.12
0.62
3.21
5.67
1.21
4.55
4.19
5.72
6.98
5.52
7.17
4.41
6.13
10.25
12.71
6.21
6.84
9.53
8.21
9.10
9.82
12/31/87
12/31/87
2/29/04
2/29/04
12/31/87
12/31/87
6/30/03
6/30/03
9/30/04
9/30/04
4/30/08
4/30/08
5/31/12
5/31/12
6/30/11
6/30/11
9/30/10
9/30/10
4/30/08
4/30/08
12/31/15
12/31/15
6/30/15
6/30/15
22
City of Clearwater Employees Pension Fund
Executive Summary Table
June 30, 2017
Net of Fee Return
Name
Value
$(000)
Calendar Years
YTD 2016 2015 2014 2013 2012
Total Fund
Policy Index
Domestic Equity Comp
S&P 500
Large Cap Equity Comp
R1000
Eagle Capital Management
Russell 1000 Value
Manning and Napier
Russell 1000 Value
NTGI-QM R1000V
R1000V
Voya Investment Mgmt
R1000G
Mid Cap Equity Comp
R Mid Cap
Artisan Partners
R Mid Cap G
Wedge Capital Mgmt
R Mid Cap V
Small Cap Equity Comp
R2000
Atlanta Capital Mgmt
Russell 2000
Riverbridge Partners
R2000G
Systematic Financial Mgt
R2000V
International EQ Comp
MSCI ACWI ex US (Net)
Eaton Vance Mgmt
MSCI Emg Mkts
Thompson, Siegel & Walmsley
MSCI EAFE (Net)
WCM Investment Management
MSCI ACWI ex US (Net)
Fixed Income Comp
BC Agg
962,861
390,348
256,477
44,307
39,205
44,192
128,772
80,906
42,468
38,437
52,965
13,033
27,588
12,344
190,161
36,447
76,993
76,721
256,986
8.31
7.50
11.01
9.34
11.10
9.27
10.50
4.66
8.69
4.66
4.73
4.66
14.36
14.00
12.36
7.99
15.33
11.40
9.37
5.18
8.68
4.99
4.31
4.99
17.38
9.97
-2.56
0.54
16.60
14.10
14.11
18.60
13.17
13.81
21.50
14.10
2.31
2.27
6.63
7.32
9.61
11.96
8.88
12.05
10.16
17.34
13.85
17.34
17.03
17.34
4.26
7.08
6.73
13.80
-0.63
7.33
14.46
20.00
18.26
21.31
18.02
21.31
13.29
11.32
28.72
31.74
2.78
4.50
12.76
11.60
-0.19
1.00
-1.00
4.50
5.01
2.65
1.42
0.22
1.48
1.38
3.35
0.92
2.35
-3.83
-0.09
-3.83
-3.66
-3.83
7.07
5.67
-1.30
-2.44
3.38
-0.20
-5.72
-4.78
-1.70
-4.41
4.97
-4.41
-3.15
-1.38
-6.39
-7.47
-9.91
-4.29
-16.09
-14.60
0.30
0.55
8.32
9.91
11.31
13.69
13.45
13.25
13.39
13.45
10.46
13.45
13.54
13.45
14.42
13.05
13.38
13.21
6.96
11.91
19.82
14.74
0.39
4.89
3.50
4.89
0.20
5.60
-2.60
4.22
-5.56
-4.48
-4.41
-1.82
6.18
5.97
17.83
14.62
35.15
32.41
32.23
33.11
32.94
32.54
31.57
33.49
37.36
34.76
39.21
35.76
34.92
33.45
42.51
38.82
42.43
37.88
43.50
43.29
40.72
34.50
10.23
23.29
1.22
-2.27
-0.75
-2.02
13.93
13.17
18.37
15.98
17.02
16.42
18.09
17.50
18.95
15.26
22.00
17.26
20.82
15.80
23.16
18.48
17.61
16.34
12.53
18.05
17.83
14.59
23.50
18.05
17.61
17.90
18.55
18.62
6.53
4.22
23
City of Clearwater Employees Pension Fund
Executive Summary Table
June 30, 2017
Net of Fee Return
Name
Value
$(000)
Calendar Years
YTD 2016 2015 2014 2013 2012
Dodge & Cox
BC Agg
In House Account
3-month T-Bill
Security Lending Income Account
3-month T-Bill
Western Asset Management Co.
BC Agg
Real Estate Comp
Policy Index
Hancock
NCREIF Timberland Index
Molpus Woodlands Group
NCREIF Timberland Index
Multi Employer Property Trust
NCREIF ODCE
Security Capital
Wilshire RESI
U.S. Real Estate Investment Fund
NCREIF ODCE Fund Index
USAA
NCREIF ODCE Fund Index
127,421
1,266
533
127,766
125,367
8,326
11,915
45,267
37,587
11,375
10,896
2.41
2.27
0.00
0.30
0.42
0.30
2.37
2.27
1.68
2.78
-0.14
1.47
0.32
1.47
2.73
3.50
0.74
2.42
3.53
3.50
1.65
3.50
5.55
2.65
0.00
0.27
1.84
0.27
3.66
2.65
6.35
8.06
-1.27
2.59
0.48
2.59
8.02
8.76
5.71
7.62
10.72
8.76
12.34
8.76
-0.12
0.55
0.03
0.03
3.41
0.03
0.73
0.55
6.35
8.33
4.51
4.97
2.64
4.97
12.00
15.01
4.70
4.81
6.01
5.97
-0.02
0.03
7.12
0.03
6.65
5.97
21.77
25.22
4.58
10.50
7.02
10.50
12.21
12.49
33.13
31.53
0.65
-2.02
0.00
0.05
2.56
0.05
-2.46
-2.02
6.29
6.02
8.91
9.68
15.16
9.68
11.83
13.94
1.60
2.15
7.85
4.22
-0.00
0.07
6.93
0.07
5.07
4.22
11.69
15.41
0.77
7.75
4.70
10.94
16.22
17.55
24
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Total Fund Public Sponsors
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
T Total Fund
Net Ret
Rank
1 Policy Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
3.81
3.22
2.85
2.50
1.57
3.41
19
3.04
37
15.10
13.40
12.41
10.92
6.07
11.85
61
10.44
78
8.03
7.10
6.40
5.55
3.67
7.39
14
7.10
25
6.90
6.07
5.42
4.51
2.78
6.25
20
5.91
29
9.65
8.80
8.11
7.23
4.87
8.98
20
8.47
38
10.52
9.76
8.93
7.97
4.87
9.75
26
9.03
44
8.86
8.23
7.65
6.84
4.61
8.29
24
8.12
31
10.57
10.05
9.39
8.18
5.63
10.50
6
10.08
22
11.09
10.43
9.94
8.64
5.77
11.55
1
10.94
6
7.52
7.12
6.65
5.97
4.27
8.17
1
7.22
18
6.61
5.97
5.57
5.13
4.04
6.72
3
5.86
32
0%
2%
4%
6%
8%
10%
12%
14%
16%
T1
T
1
T1
T1
T1
T
1
T1
T1
T
1
T
1 T
1
25
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Total Fund Public Sponsors
Years Ending December
High
1st Qt
Median
3rd Qt
Low
T Total Fund
Net Ret
Rank
1 Policy Index
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
9.25
7.87
7.13
6.45
4.32
8.31
17
7.50
34
10.25
8.97
7.92
6.87
3.90
6.63
79
7.32
65
3.55
1.36
0.09
-1.25
-3.07
1.42
22
0.22
47
9.32
7.30
6.46
5.28
3.33
8.32
12
9.91
2
21.61
19.17
16.46
13.29
5.12
17.83
37
14.62
67
15.00
13.38
12.33
10.64
6.28
13.93
17
13.17
28
5.39
2.17
0.96
-0.36
-2.83
-0.36
75
1.81
32
16.20
13.97
12.62
11.01
6.06
17.73
2
13.96
25
27.83
22.06
19.16
15.35
4.37
30.28
2
26.00
7
-1.30
-20.32
-24.63
-27.15
-30.50
-27.10
74
-27.73
79
11.11
9.10
7.83
6.50
4.61
7.20
62
6.69
71
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
T1 T1
T1
T1
T
1 T1
T1
T
1
T
1
T1
T1
26
City of Clearwater Employees Pension Fund
Performance Summary
Total Fund
June 30, 2017
-1.00.01.02.03.04.05.06.07.08.09.010.011.012.013.0
Qtr YTD 1 Year 3 Year 5 Year Incept
12/31/87
Total Fund Policy Index
Net of Fee Returns Cur Qtr YTD 1 Year 3 Yrs 5 Yrs Incept Incept Date Cur Assets
Total Fund
Policy Index
Rank
Voya Investment Mgmt
R1000G
Rank
NTGI-QM R1000V
R1000V
Rank
Eagle Capital Management
Russell 1000 Value
Rank
Manning and Napier
Russell 1000 Value
Rank
Artisan Partners
R Mid Cap G
Rank
Wedge Capital Mgmt
R Mid Cap V
Rank
3.41
3.04
19
4.54
4.67
57
1.38
1.34
78
3.75
1.34
15
2.99
1.34
32
6.81
4.21
19
3.24
1.37
1
8.31
7.50
17
14.36
14.00
45
4.73
4.66
75
10.50
4.66
5
8.69
4.66
20
15.33
11.40
13
9.37
5.18
1
11.85
10.44
61
20.09
20.42
64
15.36
15.53
58
23.41
15.53
6
15.99
15.53
49
17.20
17.05
75
19.68
15.93
35
6.25
5.91
20
11.31
11.11
22
7.38
7.36
63
10.19
7.36
8
8.24
7.36
40
7.18
7.83
67
9.29
7.46
13
9.75
9.03
26
15.36
15.30
57
14.12
13.94
41
13.70
14.20
82
16.06
15.14
8
9.19
9.27
11.74
10.13
5.62
5.56
72
14.41
12.28
11.99
12.28
9.91
8.10
9.41
7.48
12/31/87
12/31/87
6/30/07
1/31/13
1/31/13
7/31/01
2/28/07
$962,861,043
$128,772,225
$44,191,896
$44,307,388
$39,205,063
$42,468,384
$38,437,302
27
City of Clearwater Employees Pension Fund
Performance Summary
Total Fund
June 30, 2017
Net of Fee Returns Cur Qtr YTD 1 Year 3 Yrs 5 Yrs Incept Incept Date Cur Assets
Atlanta Capital Mgmt
Russell 2000
Rank
Systematic Financial Mgt
R2000V
Rank
Riverbridge Partners
R2000G
Rank
Eaton Vance Mgmt
MSCI Emg Mkts
Rank
WCM Investment Management
MSCI ACWI ex US (Net)
Rank
Thompson, Siegel & Walmsley
MSCI EAFE (Net)
Rank
Dodge & Cox
BC Agg
Rank
Western Asset Management Co.
BC Agg
Rank
Security Lending Income Account
3-month T-Bill
In House Account
3-month T-Bill
3.22
2.46
13
-0.88
0.67
81
8.79
4.39
3
3.85
6.38
74
9.34
5.78
6
5.92
6.12
57
1.30
1.45
63
1.44
1.45
56
0.27
0.18
0.00
0.18
4.31
4.99
35
-2.56
0.54
99
17.38
9.97
3
14.11
18.60
78
21.50
14.10
6
13.17
13.81
70
2.41
2.27
56
2.37
2.27
60
0.42
0.30
0.00
0.30
14.15
24.60
98
22.85
24.86
37
28.26
24.40
11
17.69
24.17
83
17.14
20.45
74
20.32
20.26
52
2.62
-0.31
34
0.33
-0.31
63
2.13
0.46
0.00
0.46
10.47
7.36
18
3.21
7.02
99
10.09
7.64
25
-1.16
1.44
91
3.08
2.48
38
2.91
2.48
46
3.56
0.20
0.00
0.20
15.27
13.94
56
12.22
13.38
95
14.16
13.98
58
3.25
4.33
95
3.61
2.21
33
2.61
2.21
52
3.60
0.15
-0.00
0.15
12.51
9.34
8.66
9.14
15.52
13.71
0.69
0.97
8.80
4.31
2.80
3.01
4.95
4.12
4.55
4.19
5.67
1.21
0.62
3.21
8/31/03
8/31/03
9/30/10
4/30/08
7/31/15
7/31/15
2/29/04
9/30/04
6/30/03
12/31/87
$13,033,467
$12,343,929
$27,587,981
$36,446,616
$76,720,978
$76,992,986
$127,420,967
$127,765,914
$533,053
$1,266,008
28
City of Clearwater Employees Pension Fund
Performance Summary
Total Fund
June 30, 2017
Net of Fee Returns Cur Qtr YTD 1 Year 3 Yrs 5 Yrs Incept Incept Date Cur Assets
Multi Employer Property Trust
NCREIF ODCE
Rank
Security Capital
Wilshire RESI
Rank
Molpus Woodlands Group
NCREIF Timberland Index
Rank
Hancock
NCREIF Timberland Index
Rank
USAA
NCREIF ODCE Fund Index
Rank
U.S. Real Estate Investment Fund
NCREIF ODCE Fund Index
Rank
1.43
1.70
63
0.79
1.91
74
0.00
0.70
81
0.00
0.70
81
-0.55
1.70
84
1.18
1.70
68
2.73
3.50
58
0.74
2.42
80
0.32
1.47
82
-0.14
1.47
84
1.65
3.50
74
3.53
3.50
49
6.16
7.87
44
-2.52
-1.23
87
1.01
3.35
63
-0.66
3.35
72
9.57
7.87
22
12.13
7.87
14
9.82
11.34
45
7.83
8.82
65
3.06
5.54
80
2.56
5.54
83
9.50
11.78
57
8.93
9.70
67
5.29
7.16
84
4.80
7.16
85
10.25
12.71
6.21
6.84
4.41
6.13
5.52
7.17
9.10
9.82
55
9.53
8.21
9/30/10
4/30/08
6/30/11
5/31/12
6/30/15
12/31/15
$45,267,169
$37,586,948
$11,915,495
$8,325,723
$10,896,412
$11,375,139
29
30
City of Clearwater Employees Pension Fund
Domestic Equity Comp as of 6/30/17
Microsoft Corp
Apple Inc
Amazon Com Inc
Pepsico Inc
Alphabet Inc Cl-A
Unitedhealth Group I
Johnson & Johnson
Home Depot Inc
Boston Scientific Co
Aon Plc
GICS Sector % Port
Information Technology
Information Technology
Consumer Discretionary
Consumer Staples
Information Technology
Health Care
Health Care
Consumer Discretionary
Health Care
Financials
3.15
2.27
1.93
1.81
1.76
1.64
1.30
1.27
1.18
1.11
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.81
3.91
13.54
16.57
6.63
13.97
13.68
26.70
1.24
0.96
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
12/31/87
Domestic Equity Comp S&P 500
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
12/31/87
Domestic Equity Comp
S&P 500
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
4.10
3.09
374,449
543
15,356
390,348
11.01
9.34
363,349
-12,457
39,456
390,348
19.49
17.90
406,722
-83,007
66,633
390,348
9.34
9.61
450,915
-162,977
102,409
390,348
14.85
14.63
310,927
-182,185
261,606
390,348
8.14
7.18
334,428
-191,834
247,754
390,348
11.27
10.48
32,236
-191,834
549,946
390,348
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
31
City of Clearwater Employees Pension Fund
Domestic Equity Comp as of 6/30/17
Cash & Equiv
$8,492 2.18%
Domestic Equity
$381,856 97.82%
Periods from 12/87 to 6/17
Alpha
Beta
R-Squared
0.08
1.09
0.93
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
E
1
T
Annualized Standard Deviation%
E Domestic Equity Comp
1 S&P 500
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
11.27
10.48
3.32
16.86
15.02
1.31
0.47
0.48
0.00
0.20
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
32
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
E Domestic Equity Comp
Net Ret
Rank
1 S&P 500
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
9.48
4.37
3.05
1.67
-0.89
4.10
28
3.09
44
28.05
22.22
18.51
16.00
7.95
19.49
42
17.90
61
13.24
10.72
9.34
7.08
0.17
9.41
48
10.73
24
12.59
9.70
8.51
6.79
1.47
9.34
35
9.61
28
15.62
13.61
12.44
10.98
5.64
12.96
40
13.19
31
17.22
15.71
14.61
13.21
9.82
14.85
40
14.63
48
14.66
13.12
12.48
11.10
7.21
12.63
45
13.05
29
18.02
16.04
15.35
14.27
11.81
15.72
31
15.41
45
18.90
16.70
15.38
14.67
10.23
16.20
30
15.29
57
13.69
11.10
9.92
9.40
5.29
10.59
34
9.71
67
10.89
8.95
7.66
6.74
2.47
8.14
40
7.18
66
-5%
0%
5%
10%
15%
20%
25%
30%
E1
E
1
E
1
E1
E1
E1
E1
E1 E1
E1
E1
33
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
E Domestic Equity Comp
Net Ret
Rank
1 S&P 500
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
18.75
11.02
8.92
5.01
-0.24
11.01
25
9.34
38
28.16
17.30
11.99
7.02
-1.13
9.61
66
11.96
50
8.15
1.68
-0.65
-3.96
-12.43
1.48
26
1.38
29
15.92
12.97
9.09
4.44
-5.17
11.31
37
13.69
14
45.15
37.78
33.13
28.47
0.04
35.15
37
32.41
57
22.64
17.93
15.90
12.32
2.35
18.37
21
15.98
48
8.11
2.19
-0.15
-4.09
-11.63
-0.21
50
2.12
27
32.86
25.21
17.11
13.93
5.75
22.53
32
15.05
66
54.26
37.17
29.15
24.33
9.52
32.14
40
26.45
66
-17.84
-33.51
-37.00
-40.93
-49.16
-37.76
57
-36.99
49
22.34
10.63
5.45
0.41
-7.56
7.18
36
5.52
47
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
E1 E1
E1
E1
E1
E1
E1
E
1
E
1
E1
E1
34
City of Clearwater Employees Pension Fund
Risk Measure Summary
Domestic Equity Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.09
0.75
2.64
6.63
19.49
19.49
3.32
1.06
0.10
0.88
5.72
17.88
2.09
0.67
0
4
3.09
6.07
17.90
17.90
2.58
6.76
3
9
0.99
1.08
0.50
-6.95
6.63
-2.07
19.49
7.67
1.04
-0.14
0.90
1.19
8.78
2.52
-0.09
1
11
-6.44
7.04
-0.61
17.90
6.97
1.35
3
17
1.00
0.87
0.50
-6.95
11.42
-2.07
35.15
8.17
1.00
0.06
0.89
1.80
14.67
2.76
0.07
2
18
-6.44
10.61
-0.61
32.41
7.69
1.88
35
83
1.07
1.05
0.53
-23.59
22.08
-37.76
55.86
16.86
1.09
0.08
0.93
0.47
7.32
4.50
0.20
30
88
-21.93
21.32
-38.07
49.75
15.02
0.48
35
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Equity Portfolios
Annualized Rate of Return0.0 1.8 3.6 5.4 7.2 9.0 10.8 12.6 14.4 16.2 18.0
1.0
2.5
4.0
5.5
7.0
8.5
10.0
11.5
13.0
14.5
16.0
ES MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
E Domestic Equity Comp
S Standard & Poors 500
Median
9.34 35 7.67 34
9.61 28 6.97 15
8.51 9.03
Annualized Rate of Return3.0 4.2 5.4 6.6 7.8 9.0 10.2 11.4 12.6 13.8 15.0
10.0
10.9
11.7
12.6
13.5
14.4
15.3
16.2
17.1
18.0
18.9
ES MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
E Domestic Equity Comp
S Standard & Poors 500
Median
14.85 40 8.17 32
14.63 48 7.69 14
14.61 9.27
36
City of Clearwater Employees Pension Fund
Large Cap Equity Comp as of 6/30/17
Microsoft Corp
Apple Inc
Amazon Com Inc
Pepsico Inc
Alphabet Inc Cl-A
Unitedhealth Group I
Johnson & Johnson
Home Depot Inc
Aon Plc
Berkshire Hathaway I
GICS Sector % Port
Information Technology
Information Technology
Consumer Discretionary
Consumer Staples
Information Technology
Health Care
Health Care
Consumer Discretionary
Financials
Financials
5.07
3.66
3.12
2.92
2.83
2.64
2.09
2.05
1.79
1.71
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
1.47
3.55
11.37
17.83
8.89
13.42
11.46
30.02
2.00
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
3/31/88
Large Cap Equity Comp R1000
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
3/31/88
Large Cap Equity Comp
R1000
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
3.61
3.06
247,269
281
8,927
256,477
11.10
9.27
235,980
-5,479
25,975
256,477
19.14
18.03
251,340
-37,524
42,661
256,477
10.00
9.26
270,594
-84,056
69,939
256,477
14.98
14.67
182,327
-87,248
161,397
256,477
7.53
7.29
172,406
-48,884
132,954
256,477
10.53
10.47
18,032
-48,884
287,328
256,477
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
37
City of Clearwater Employees Pension Fund
Large Cap Equity Comp as of 6/30/17
Cash & Equiv
$2,879 1.12%
Domestic Equity
$253,597 98.88%
Periods from 3/88 to 6/17
Alpha
Beta
R-Squared
0.05
0.98
0.96
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
L1
T
Annualized Standard Deviation%
L Large Cap Equity Comp
1 R1000
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
10.53
10.47
3.30
15.47
15.44
1.31
0.47
0.46
0.00
0.00
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
38
City of Clearwater Employees Pension Fund
Large Neutral Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
L Large Cap Equity Comp
Net Ret
Rank
1 R1000
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
5.23
3.18
3.07
2.67
1.22
3.61
14
3.06
55
27.14
20.09
18.07
17.83
13.07
19.14
30
18.03
52
12.39
10.73
10.30
9.15
7.24
10.37
46
10.22
56
10.97
9.67
9.32
8.62
6.22
10.00
11
9.26
56
14.49
13.30
13.13
12.51
10.01
13.50
17
13.09
55
16.60
15.12
14.68
14.55
12.15
14.98
30
14.67
52
14.08
13.13
12.94
12.72
10.42
12.73
73
12.89
61
16.48
15.61
15.43
15.25
12.90
15.28
72
15.43
51
16.93
15.51
15.36
15.17
13.20
15.44
31
15.41
38
11.45
10.11
9.82
9.70
8.19
9.59
79
9.73
69
9.23
7.53
7.25
6.70
6.18
7.53
25
7.29
41
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
26%
28%
L1
L
1
L1 L1
L1
L1
L1
L1 L1
L1
L1
39
City of Clearwater Employees Pension Fund
Large Neutral Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
L Large Cap Equity Comp
Net Ret
Rank
1 R1000
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
12.12
9.45
9.30
8.41
5.89
11.10
10
9.27
54
20.74
12.70
11.96
10.89
8.34
8.88
91
12.05
38
3.52
1.45
0.97
-0.28
-5.89
3.35
5
0.92
52
16.29
13.74
13.32
12.03
7.50
13.45
47
13.25
52
39.75
34.02
32.96
32.35
28.79
32.23
80
33.11
42
22.02
17.02
16.26
15.92
10.00
17.02
25
16.42
40
5.80
2.22
1.71
0.67
-3.96
-0.90
84
1.51
57
18.27
16.18
15.13
14.08
11.52
16.87
17
16.10
27
43.11
30.18
26.95
25.80
20.95
24.59
85
28.42
38
-28.61
-35.92
-36.89
-37.68
-43.15
-35.23
19
-37.60
73
12.91
6.39
5.57
4.47
-0.54
7.76
14
5.77
40
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
L1 L1
L1
L1
L1
L1
L1
L1
L
1
L1
L1
40
City of Clearwater Employees Pension Fund
Risk Measure Summary
Large Cap Equity Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.06
0.75
2.63
7.23
19.14
19.14
3.95
1.13
-0.29
0.91
4.72
16.49
2.05
0.49
0
4
3.06
6.03
18.03
18.03
2.53
6.94
2
10
1.04
0.92
0.67
-6.25
7.43
0.56
19.14
7.33
1.01
0.15
0.94
1.33
9.66
1.79
0.39
1
11
-6.83
6.50
-0.61
18.03
7.05
1.28
2
18
1.01
0.92
0.55
-6.25
10.65
0.56
32.23
7.91
1.00
0.07
0.96
1.87
14.81
1.55
0.18
1
19
-6.83
10.96
-0.61
33.11
7.76
1.87
34
83
0.99
0.98
0.52
-20.96
20.12
-37.57
49.31
15.47
0.98
0.05
0.96
0.47
7.37
2.94
0.00
29
88
-22.48
21.88
-38.26
51.57
15.44
0.46
41
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Large Neutral Portfolios
Annualized Rate of Return4.5 5.05 5.6 6.15 6.7 7.25 7.8 8.35 8.9 9.45 10.0
5.0
5.9
6.8
7.7
8.6
9.5
10.4
11.2
12.1
13.0
13.9
L
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
L Large Cap Equity Comp
1 R1000
Median
10.00 11 7.33 56
9.26 56 7.05 40
9.32 7.24
Annualized Rate of Return5.0 5.55 6.1 6.65 7.2 7.75 8.3 8.85 9.4 9.95 10.5
11.0
12.0
13.0
14.0
15.0
16.0
17.0
18.0
19.0
L1Median RiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
L Large Cap Equity Comp
1 R1000
Median
14.98 30 7.91 54
14.67 52 7.76 39
14.68 7.87
42
City of Clearwater Employees Pension Fund
Voya Investment Mgmt as of 6/30/17
Apple Inc
Microsoft Corp
Alphabet Inc Cl-A
Amazon Com Inc
Unitedhealth Group I
Pepsico Inc
Mastercard Inc
Home Depot Inc
Facebook Inc
Celgene Corp
GICS Sector % Port
Information Technology
Information Technology
Information Technology
Consumer Discretionary
Health Care
Consumer Staples
Information Technology
Consumer Discretionary
Information Technology
Health Care
6.04
5.83
4.16
3.42
2.89
2.86
2.61
2.52
2.29
2.21
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
0.62
3.64
12.60
18.54
7.80
13.80
3.82
36.49
2.68
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
12/31/87
Voya Investment Mgmt R1000G
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
12/31/87
Voya Investment Mgmt
R1000G
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
4.54
4.67
123,054
128
5,590
128,772
14.36
14.00
117,870
-5,750
16,652
128,772
20.09
20.42
124,709
-18,514
22,577
128,772
11.31
11.11
134,334
-45,276
39,714
128,772
15.36
15.30
98,112
-53,283
83,943
128,772
9.61
8.91
58,137
-34,899
105,534
128,772
11.74
10.13
17,469
-34,899
146,202
128,772
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
43
City of Clearwater Employees Pension Fund
Voya Investment Mgmt as of 6/30/17
Cash & Equiv
$1,813 1.41%
Domestic Equity
$126,959 98.59%
Periods from 12/87 to 6/17
Alpha
Beta
R-Squared
0.59
0.85
0.93
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0 i
1
T
Annualized Standard Deviation%
i Voya Investment Mgmt
1 R1000G
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
11.74
10.13
3.32
15.56
17.58
1.31
0.54
0.39
0.00
0.21
Asset Allocation ($000)
Risk/Return Analysis
44
City of Clearwater Employees Pension Fund
Large Growth Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
i Voya Investment Mgmt
Net Ret
Rank
1 R1000G
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
8.89
7.11
4.69
3.67
0.56
4.54
57
4.67
52
31.98
25.17
21.52
18.03
13.54
20.09
64
20.42
59
16.06
11.20
9.58
8.10
4.68
10.66
36
11.38
22
14.05
11.17
10.00
8.22
4.21
11.31
22
11.11
25
17.52
15.44
14.39
13.06
9.79
14.87
38
14.87
38
18.56
16.57
15.65
14.45
11.83
15.36
57
15.30
57
16.31
14.05
13.30
12.31
9.44
13.91
35
13.65
42
18.75
17.11
16.23
15.33
12.33
16.71
35
16.48
40
19.03
16.89
15.75
14.93
11.98
16.49
35
16.12
45
13.13
11.55
10.20
9.31
5.29
10.89
40
10.70
44
11.57
9.99
8.63
8.13
2.38
9.61
30
8.91
41
0%
5%
10%
15%
20%
25%
30%
35%
i1
i1
i1 i1
i1 i1
i1
i1 i1
i1 i1
45
City of Clearwater Employees Pension Fund
Large Growth Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
i Voya Investment Mgmt
Net Ret
Rank
1 R1000G
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
22.63
18.22
14.00
10.49
7.98
14.36
45
14.00
50
12.11
7.64
4.94
0.84
-6.82
4.26
56
7.08
31
11.37
7.59
4.95
2.27
-4.89
7.07
31
5.67
44
17.39
13.64
11.77
9.12
6.38
14.42
16
13.05
38
44.93
38.06
35.46
33.00
28.63
31.57
85
33.49
69
23.91
19.39
16.88
14.46
10.92
18.95
32
15.26
69
6.72
3.01
0.47
-3.46
-9.21
3.04
24
2.63
30
27.41
20.40
17.03
14.61
10.48
17.10
49
16.72
57
58.87
42.29
35.32
28.88
21.89
24.43
86
37.21
42
-28.68
-36.20
-38.18
-41.52
-48.48
-33.18
9
-38.43
53
24.51
19.60
14.51
11.80
4.28
17.10
32
11.82
73
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
i1
i1 i1
i1
i1
i1
i1
i1
i
1
i
1
i
1
46
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Large Growth Portfolios
High
1st Qt
Median
3rd Qt
Low
i Voya Investment Mgmt
Net Ret
Rank
1 R1000G
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
14.12
11.19
10.16
8.83
6.03
11.31
24
11.11
28
12.40
11.35
10.32
8.55
6.29
11.80
14
11.27
27
10.36
8.82
7.86
6.23
3.96
8.50
38
8.55
35
13.26
11.92
10.65
9.14
7.24
12.06
24
11.83
30
14.95
13.08
11.88
10.36
8.97
13.19
20
13.07
25
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
14%
15%
16%
i 1
i
1
i 1
i 1
i 1
Voya Investment Mgmt
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
1.7
-0.1
-0.4
-0.9
0.2
-0.3
-1.1
0.8
1.0
0.6
0.5
-0.2
-0.1
1.2
-1.9
-0.2
0.5
-1.1
0.4
-0.1
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R1000G
47
City of Clearwater Employees Pension Fund
Risk Measure Summary
Voya Investment Mgmt
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
0.98
0.50
-0.06
9.39
20.09
20.09
7.73
1.11
-0.56
0.98
2.54
17.71
1.47
-0.16
0
4
1.01
8.91
20.42
20.42
6.46
3.09
4
8
1.02
1.02
0.50
-5.39
9.39
1.42
20.09
8.50
1.11
-0.23
0.97
1.30
9.99
1.75
0.14
1
11
-5.29
8.91
2.52
20.42
7.53
1.44
6
14
1.01
1.03
0.45
-5.39
10.10
1.42
31.57
8.81
1.07
-0.23
0.97
1.72
14.18
1.76
0.06
2
18
-5.29
10.44
2.52
33.49
8.06
1.88
35
83
0.96
0.80
0.53
-18.51
23.26
-33.74
44.38
15.56
0.85
0.59
0.93
0.54
9.90
4.98
0.21
34
84
-22.79
26.75
-45.64
49.75
17.58
0.39
48
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Large Growth Portfolios
Annualized Rate of Return0.0 1.8 3.6 5.4 7.2 9.0 10.8 12.6 14.4 16.2 18.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
i1 MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
i Voya Investment Mgmt
1 R1000G
Median
11.31 22 8.50 36
11.11 25 7.53 15
10.00 9.29
Annualized Rate of Return3.0 4.3 5.6 6.9 8.2 9.5 10.8 12.1 13.4 14.7 16.0
11.0
11.9
12.7
13.6
14.5
15.4
16.3
17.2
18.1
19.0
19.9
i1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
i Voya Investment Mgmt
1 R1000G
Median
15.36 57 8.81 36
15.30 57 8.06 19
15.65 9.40
49
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Voya Investment Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R1000G
60
126,959,156
168,776,804
35,284,844
1.23
26.27
26.65
1.00
5.56
59.89
10.11
557
181,283,901
10,066,988
1.43
27.63
25.01
1.03
5.96
62.27
10.19
Ten Largest Holdings
Apple Inc
Microsoft Corp
Alphabet Inc Cl-A
Amazon Com Inc
Unitedhealth Group I
Pepsico Inc
Mastercard Inc
Home Depot Inc
Facebook Inc
Celgene Corp
Market Value % of Portfolio Quarterly Ret
7,664,024
7,403,427
5,276,864
4,340,512
3,662,972
3,634,470
3,305,990
3,199,157
2,900,024
2,809,088
6.04
5.83
4.16
3.42
2.89
2.86
2.61
2.52
2.29
2.21
0.66
5.25
9.66
9.19
13.52
3.96
8.20
5.08
6.29
4.37
Ten Best Performers
Transdigm Group Inc
McDonalds Corp
Electronic Arts
Delta Air Lines Inc
Berry Plastics Group
Zoetis Inc
Coach Inc
Unitedhealth Group I
Ingersoll-Rand Plc
Crown Holdings Inc
Quarterly Ret
22.12
18.90
18.10
17.42
17.38
17.31
15.38
13.52
12.89
12.67
Ten Worst Performers
O Reilly Automotive
Diamondback Energy I
Dollar Tree Inc
Burlington Stores In
Vmware Inc
Texas Instrs Inc
Sysco Corp
Skyworks Solutions I
Vantiv Inc
Dish Network Corp
Quarterly Ret
-18.94
-14.37
-10.88
-5.45
-5.11
-3.92
-2.44
-1.80
-1.22
-1.15
50
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Voya Investment Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R1000G
60
126,959,156
168,776,804
35,284,844
1.23
26.27
26.65
1.00
5.56
59.89
10.11
557
181,283,901
10,066,988
1.43
27.63
25.01
1.03
5.96
62.27
10.19
Ten Best Contributors
Alphabet Inc Cl-A
Unitedhealth Group I
Delta Air Lines Inc
Amazon Com Inc
McDonalds Corp
Microsoft Corp
Zoetis Inc
Boston Scientific Co
Mastercard Inc
Transdigm Group Inc
Market Value % of Portfolio Quarterly Ret
5,276,864
3,662,972
2,473,384
4,340,512
2,104,112
7,403,427
1,951,870
2,469,048
3,305,990
1,161,518
4.16
2.89
1.95
3.42
1.66
5.83
1.54
1.95
2.61
0.92
9.66
13.52
17.42
9.19
18.90
5.25
17.31
11.46
8.20
22.12
Ten Worst Contributors
O Reilly Automotive
Dollar Tree Inc
Burlington Stores In
Diamondback Energy I
Vmware Inc
Texas Instrs Inc
Sysco Corp
Dish Network Corp
Biogen Idec Inc
Skyworks Solutions I
Market Value % of Portfolio Quarterly Ret
2,059,218
1,780,792
2,064,992
782,416
1,734,524
1,688,229
1,881,839
1,456,973
2,214,569
908,647
1.62
1.40
1.63
0.62
1.37
1.33
1.48
1.15
1.75
0.72
-18.94
-10.88
-5.45
-14.37
-5.11
-3.92
-2.44
-1.15
-0.75
-1.80
51
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Voya Investment Mgmt
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
0.72
3.50
10.55
21.44
9.87
15.44
4.32
32.12
2.05
0.00
100.00
0.50
3.54
10.70
20.91
9.13
15.92
2.83
32.66
1.02
0.03
100.00
-12.86
8.34
9.36
0.46
1.19
8.39
11.29
5.10
9.96
5.03
-8.03
5.67
5.29
3.11
2.04
8.06
7.03
5.45
-7.13
-0.29
4.75
-0.04
0.09
0.43
-0.57
-0.08
0.05
0.18
-0.11
0.35
0.00
0.31
-0.03
-0.00
-0.00
-0.01
-0.02
-0.02
0.03
-0.00
-0.12
0.00
-0.16
-0.06
0.09
0.43
-0.58
-0.10
0.04
0.22
-0.11
0.23
0.00
0.15
Index - R1000G
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.35%
[ Actual Return 4.67% ] - [ Buy Hold Return 5.03% ]
52
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Voya Investment Mgmt
Quarter Ending 6/17
% Allocation
Energy 0.72 0.50
Materials 3.50 3.54
Industrials 10.55 10.70
Con. Discretionary 21.44 20.91
Consumer Staples 9.87 9.13
Health Care 15.44 15.91
Financials 4.32 2.83
Infomation Tech.32.12 32.66
Telecom. Services 2.05 1.02
Utilities 0.00 0.03
Voya Investment Mgmt R1000G
% Return
-12.86 -8.03
8.34 5.67
9.36 5.29
0.46 3.11
1.19 2.04
8.39 8.06
11.29 7.03
5.10 5.45
9.96 -7.13
-0.29
% Variance
-0.06
0.09
0.43
-0.58
-0.10
0.04
0.22
-0.11
0.23
0.00
53
City of Clearwater Employees Pension Fund
NTGI-QM R1000V as of 6/30/17
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
6/30/07
NTGI-QM R1000V R1000V
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
6/30/07
NTGI-QM R1000V
R1000V
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.38
1.34
43,585
4
603
44,192
4.73
4.66
42,187
9
1,996
44,192
15.36
15.53
42,156
-3,983
6,019
44,192
7.38
7.36
48,200
-12,971
8,963
44,192
14.12
13.94
57,648
-48,281
34,825
44,192
5.62
5.56
26,197
-38,782
56,777
44,192
5.62
5.56
26,197
-38,782
56,777
44,192
Portfolio Performance (%)
54
City of Clearwater Employees Pension Fund
NTGI-QM R1000V as of 6/30/17
Domestic Equity
$44,192 100.00%
Periods from 6/07 to 6/17
Alpha
Beta
R-Squared
0.02
1.00
1.00
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
n1
T
Annualized Standard Deviation%
n NTGI-QM R1000V
1 R1000V
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
5.62
5.56
0.58
17.54
17.60
0.60
0.29
0.28
0.00
0.08
Asset Allocation ($000)
Risk/Return Analysis
55
City of Clearwater Employees Pension Fund
Large Value Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
n NTGI-QM R1000V
Net Ret
Rank
1 R1000V
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
4.52
3.19
2.37
1.43
-0.02
1.38
78
1.34
81
25.06
18.60
15.98
12.60
7.01
15.36
58
15.53
56
12.17
10.87
9.29
7.71
4.32
8.94
59
9.01
59
10.35
8.73
7.86
6.52
1.55
7.38
63
7.36
63
13.43
12.34
11.47
10.29
5.85
11.28
56
11.26
56
16.48
15.75
13.79
12.37
10.99
14.12
41
13.94
46
13.82
13.04
12.26
11.18
9.16
11.97
60
12.04
60
16.36
15.28
14.72
13.73
12.50
14.27
63
14.31
62
16.42
15.53
14.87
13.74
11.80
14.66
55
14.63
58
11.77
10.35
9.77
8.73
5.48
8.73
77
8.69
77
10.87
7.48
6.43
5.56
3.03
5.62
72
5.56
75
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
26%
n1
n1
n1
n1
n1
n1
n1
n1 n1
n1
n1
56
City of Clearwater Employees Pension Fund
Large Value Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
n NTGI-QM R1000V
Net Ret
Rank
1 R1000V
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008
10.67
8.52
6.09
4.73
2.67
4.73
75
4.66
77
21.29
17.07
14.85
11.95
9.49
17.03
25
17.34
19
1.76
-0.23
-1.88
-4.13
-9.96
-3.66
66
-3.83
70
15.55
13.75
12.13
10.57
5.63
13.54
29
13.45
32
41.31
37.61
33.25
29.44
24.08
32.94
52
32.54
56
20.61
17.95
16.52
14.30
11.02
18.09
23
17.50
33
13.12
3.44
0.83
-2.83
-7.81
-0.77
64
0.39
57
20.53
17.68
15.65
13.55
10.54
15.75
48
15.51
53
41.06
31.12
24.39
20.06
10.37
20.35
71
19.69
78
-24.50
-34.33
-36.33
-38.30
-45.27
-36.86
61
-36.85
61
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
n1
n1
n1
n1
n1
n1
n1
n1
n1
n1
57
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Large Value Portfolios
High
1st Qt
Median
3rd Qt
Low
n NTGI-QM R1000V
Net Ret
Rank
1 R1000V
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
10.35
8.74
7.95
6.72
4.75
7.38
67
7.36
67
10.50
9.56
8.87
7.49
6.04
8.68
58
8.67
59
9.92
8.96
8.20
7.31
5.53
8.58
39
8.59
39
11.20
10.32
9.46
8.43
6.63
9.71
41
9.70
41
12.22
10.68
9.90
8.64
7.20
9.95
48
9.87
53
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
n 1
n 1 n 1
n 1 n 1
NTGI-QM R1000V
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-0.4%
-0.2%
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
0.4
0.0
0.3
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0.1
0.0 0.0 0.0 0.0
-0.2
0.0 0.0 0.0
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R1000V
58
City of Clearwater Employees Pension Fund
Risk Measure Summary
NTGI-QM R1000V
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.99
0.50
1.38
6.66
15.36
15.36
4.39
0.99
-0.00
1.00
3.39
15.02
0.23
-0.66
0
4
1.34
6.68
15.53
15.53
4.42
3.40
3
9
1.00
0.99
0.75
-8.37
6.66
-4.27
18.95
8.02
1.00
0.01
1.00
0.89
7.18
0.15
0.09
3
9
-8.40
6.68
-4.42
19.22
8.06
0.88
3
17
1.01
0.99
0.80
-8.37
12.60
-4.27
32.94
8.62
1.01
0.01
1.00
1.62
13.82
0.27
0.65
3
17
-8.40
12.31
-4.42
32.54
8.54
1.61
14
26
1.00
1.00
0.83
-22.13
18.29
-42.31
54.33
17.54
1.00
0.02
1.00
0.29
5.07
0.52
0.08
14
26
-22.17
18.24
-42.42
53.57
17.60
0.28
59
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Large Value Portfolios
Annualized Rate of Return3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
n1MedianRisk Median
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
n NTGI-QM R1000V
1 R1000V
Median
7.38 63 8.02 55
7.36 63 8.06 57
7.86 7.89
Annualized Rate of Return5.0 5.7 6.4 7.1 7.8 8.5 9.2 9.9 10.6 11.3 12.0
9.0
9.9
10.7
11.6
12.5
13.4
14.3
15.2
16.1
17.0
17.9
n1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
n NTGI-QM R1000V
1 R1000V
Median
14.12 41 8.62 58
13.94 46 8.54 56
13.79 8.45
60
City of Clearwater Employees Pension Fund
Eagle Capital Management as of 6/30/17
Berkshire Hathaway I
Oracle Corp
Microsoft Corp
Citigroup Inc
Alphabet Inc Cl-C
Aon Plc
Amazon Com Inc
Twenty First Centy F
Unitedhealth Group I
Ecolab Inc
GICS Sector % Port
Financials
Information Technology
Information Technology
Financials
Information Technology
Financials
Consumer Discretionary
Consumer Discretionary
Health Care
Materials
8.15
7.47
7.31
6.79
5.64
5.63
4.97
4.65
4.24
4.23
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.59
4.23
0.00
22.67
5.46
7.10
34.82
23.12
0.00
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
1/31/13
Eagle Capital Management Russell 1000 Value
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
1/31/13
Eagle Capital Management
Russell 1000 Value
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
3.75
1.34
42,624
86
1,597
44,307
10.50
4.66
39,941
168
4,198
44,307
23.41
15.53
40,560
-4,681
8,429
44,307
10.19
7.36
45,018
-12,529
11,818
44,307
14.41
12.28
33,239
-12,531
23,599
44,307
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
61
City of Clearwater Employees Pension Fund
Eagle Capital Management as of 6/30/17
Cash & Equiv
$369 0.83%
Domestic Equity
$43,938 99.17%
Periods from 1/13 to 6/17
Alpha
Beta
R-Squared
1.05
0.71
0.64
Annualized Return%
-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
E
1
T
Annualized Standard Deviation%
E Eagle Capital Management
1 Russell 1000 Value
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
14.41
12.28
0.18
10.57
10.09
0.07
1.35
1.20
0.00
0.04
Asset Allocation ($000)
Risk/Return Analysis
62
City of Clearwater Employees Pension Fund
Large Value Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
E Eagle Capital Management
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
Last
Qtr
Last 2
Qtrs
Last 3
Qtrs
6/17
YTD
Last
Year
4.52
3.19
2.37
1.43
-0.02
3.75
15
1.34
81
10.67
8.52
6.09
4.73
2.67
10.50
5
4.66
77
17.71
14.59
12.84
10.55
7.40
17.97
4
11.64
64
10.67
8.52
6.09
4.73
2.67
10.50
5
4.66
77
25.06
18.60
15.98
12.60
7.01
23.41
6
15.53
56
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
26%
E
1
E
1
E
1
E
1
E
1
63
City of Clearwater Employees Pension Fund
Large Value Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
E Eagle Capital Management
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
6/30/17
YTD
10.67
8.52
6.09
4.73
2.67
10.50
5
4.66
77
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
E
1
64
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Large Value Portfolios
High
1st Qt
Median
3rd Qt
Low
E Eagle Capital Management
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
10.35
8.74
7.95
6.72
4.75
10.19
8
7.36
67
10.50
9.56
8.87
7.49
6.04
10.21
9
8.67
59
9.92
8.96
8.20
7.31
5.53
8.53
41
8.59
39
11.20
10.32
9.46
8.43
6.63
9.68
41
9.70
41
12.22
10.68
9.90
8.64
7.20
10.33
40
9.87
53
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
E
1
E
1 E 1
E 1
E
1
Eagle Capital Management
Value Added Analysis - Net of Fee
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-7.0%
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
-6.6
1.0
2.4
0.1
-1.3 -1.2
2.0
0.5
2.0
1.6 1.6
1.1
-4.8
-2.5
1.1
0.1
3.1
2.4
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. Russell 1000 Value
65
City of Clearwater Employees Pension Fund
Risk Measure Summary
Eagle Capital Management
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.51
1.00
3.75
6.75
23.41
23.41
2.93
0.96
1.84
0.75
7.83
23.78
2.79
2.51
0
4
1.34
6.68
15.53
15.53
4.42
3.40
2
10
1.08
0.44
0.83
-6.93
6.79
-2.18
23.41
8.36
0.89
0.87
0.72
1.19
11.23
4.56
0.57
3
9
-8.40
6.68
-4.42
19.22
8.06
0.88
2
15
1.06
0.44
0.76
-6.93
10.17
-2.18
24.38
8.06
0.90
0.83
0.76
1.68
15.12
4.14
0.50
3
14
-8.40
10.01
-4.42
23.82
7.87
1.42
66
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Eagle Capital Management
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 1000 Value
29
43,937,943
217,938,477
68,256,154
1.12
25.69
19.31
1.09
1.19
80.96
6.06
719
114,494,104
8,624,486
2.44
22.31
19.49
0.99
1.71
69.41
0.85
Ten Largest Holdings
Berkshire Hathaway I
Oracle Corp
Microsoft Corp
Citigroup Inc
Alphabet Inc Cl-C
Aon Plc
Amazon Com Inc
Twenty First Centy F
Unitedhealth Group I
Ecolab Inc
Market Value % of Portfolio Quarterly Ret
3,577,941
3,279,156
3,212,138
2,982,848
2,476,289
2,472,870
2,182,840
2,044,265
1,863,471
1,858,500
8.15
7.47
7.31
6.79
5.64
5.63
4.97
4.65
4.24
4.23
1.61
12.88
5.25
12.10
9.54
12.35
9.19
-12.30
13.52
6.20
Ten Best Performers
Ilg Inc
Thermo Fisher Scient
Unitedhealth Group I
Oracle Corp
Aon Plc
Citigroup Inc
Alphabet Inc Cl-A
Alphabet Inc Cl-C
Amazon Com Inc
Fidelity Natl Inform
Quarterly Ret
31.88
13.68
13.52
12.88
12.35
12.10
9.66
9.54
9.19
7.62
Ten Worst Performers
Anadarko Pete Corp
Noble Energy Inc
Twenty First Centy F
Liberty Global Plc
Liberty Global Plc
Goldman Sachs Group
Berkley W R Corp
Dish Network Corp
General Motors Corp.
Wells Fargo & Co New
Quarterly Ret
-26.80
-17.32
-12.30
-11.02
-7.07
-3.07
-1.15
-1.15
-0.12
0.24
67
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Eagle Capital Management
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 1000 Value
29
43,937,943
217,938,477
68,256,154
1.12
25.69
19.31
1.09
1.19
80.96
6.06
719
114,494,104
8,624,486
2.44
22.31
19.49
0.99
1.71
69.41
0.85
Ten Best Contributors
Oracle Corp
Citigroup Inc
Aon Plc
Unitedhealth Group I
Alphabet Inc Cl-C
Amazon Com Inc
Thermo Fisher Scient
Microsoft Corp
Marriott Intl Inc Ne
Ecolab Inc
Market Value % of Portfolio Quarterly Ret
3,279,156
2,982,848
2,472,870
1,863,471
2,476,289
2,182,840
1,256,184
3,212,138
1,685,710
1,858,500
7.47
6.79
5.63
4.24
5.64
4.97
2.86
7.31
3.84
4.23
12.88
12.10
12.35
13.52
9.54
9.19
13.68
5.25
6.85
6.20
Ten Worst Contributors
Twenty First Centy F
Liberty Global Plc
Noble Energy Inc
Anadarko Pete Corp
Goldman Sachs Group
Dish Network Corp
Liberty Global Plc
Berkley W R Corp
General Motors Corp.
Wells Fargo & Co New
Market Value % of Portfolio Quarterly Ret
2,044,265
1,764,788
775,420
362,720
1,153,880
1,484,274
211,766
620,801
444,484
1,331,225
4.65
4.02
1.77
0.83
2.63
3.38
0.48
1.41
1.01
3.03
-12.30
-11.02
-17.32
-26.80
-3.07
-1.15
-7.07
-1.15
-0.12
0.24
68
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Eagle Capital Management
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
3.51
4.28
0.00
23.74
6.40
6.72
32.55
22.79
0.00
0.00
100.00
12.20
2.92
10.05
4.47
8.47
10.84
26.59
9.92
3.60
6.26
100.00
-20.59
6.20
-2.18
2.51
13.59
5.60
9.08
3.99
-7.09
0.16
3.36
2.79
0.70
6.02
3.75
0.47
-7.10
2.16
1.24
-0.47
0.26
0.00
-1.18
0.12
0.51
0.60
1.96
0.00
0.00
1.79
0.72
-0.01
-0.21
0.30
0.01
-0.20
0.15
-0.10
0.30
-0.06
0.90
0.25
0.24
-0.21
-0.88
0.13
0.31
0.75
1.86
0.30
-0.06
2.70
Index - Russell 1000 Value
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.03%
[ Actual Return 4.02% ] - [ Buy Hold Return 3.99% ]
69
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Eagle Capital Management
Quarter Ending 6/17
% Allocation
Energy 3.51 12.20
Materials 4.28 2.92
Industrials 0.00 10.05
Con. Discretionary 23.74 4.47
Consumer Staples 6.40 8.47
Health Care 6.72 10.84
Financials 32.55 26.59
Infomation Tech.22.79 9.92
Telecom. Services 0.00 3.60
Utilities 0.00 6.26
Eagle Capital Management Russell 1000 Value
% Return
-20.59 -7.09
6.20 0.16
3.36
-2.18 2.79
2.51 0.70
13.59 6.02
5.60 3.75
9.08 0.47
-7.10
2.16
% Variance
0.25
0.24
-0.21
-0.88
0.13
0.31
0.75
1.86
0.30
-0.06
70
City of Clearwater Employees Pension Fund
Manning and Napier as of 6/30/17
Johnson & Johnson
J P Morgan Chase & C
Wells Fargo & Co New
Home Depot Inc
Wal Mart Stores Inc
Pfizer Inc
Pepsico Inc
Taiwan Semiconductor
Merck & Co Inc New
3m Co
GICS Sector % Port
Health Care
Financials
Financials
Consumer Discretionary
Consumer Staples
Health Care
Consumer Staples
Information Technology
Health Care
Industrials
4.24
3.74
3.32
2.82
2.79
2.70
2.49
2.47
2.45
2.29
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.99
2.46
20.28
9.95
16.40
19.38
9.98
16.53
2.04
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
1/31/13
Manning and Napier Russell 1000 Value
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
1/31/13
Manning and Napier
Russell 1000 Value
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
2.99
1.34
38,006
63
1,136
39,205
8.69
4.66
35,983
94
3,128
39,205
15.99
15.53
43,915
-10,342
5,632
39,205
8.24
7.36
43,042
-13,276
9,439
39,205
11.99
12.28
33,104
-13,277
19,378
39,205
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
71
City of Clearwater Employees Pension Fund
Manning and Napier as of 6/30/17
Cash & Equiv
$697 1.78%
Domestic Equity
$38,508 98.22%
Periods from 1/13 to 6/17
Alpha
Beta
R-Squared
0.79
0.62
0.72
Annualized Return%
-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
M 1
T
Annualized Standard Deviation%
M Manning and Napier
1 Russell 1000 Value
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
11.99
12.28
0.18
9.13
10.09
0.07
1.29
1.20
0.00
-0.41
Asset Allocation ($000)
Risk/Return Analysis
72
City of Clearwater Employees Pension Fund
Large Value Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
M Manning and Napier
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
Last
Qtr
Last 2
Qtrs
Last 3
Qtrs
6/17
YTD
Last
Year
4.52
3.19
2.37
1.43
-0.02
2.99
32
1.34
81
10.67
8.52
6.09
4.73
2.67
8.69
20
4.66
77
17.71
14.59
12.84
10.55
7.40
11.67
64
11.64
64
10.67
8.52
6.09
4.73
2.67
8.69
20
4.66
77
25.06
18.60
15.98
12.60
7.01
15.99
49
15.53
56
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
26%
M
1
M
1
M 1
M
1
M 1
73
City of Clearwater Employees Pension Fund
Large Value Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
M Manning and Napier
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
6/30/17
YTD
10.67
8.52
6.09
4.73
2.67
8.69
20
4.66
77
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
M
1
74
City of Clearwater Employees Pension Fund
Risk Measure Summary
Manning and Napier
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.03
0.75
2.74
5.54
15.99
15.99
2.53
0.41
2.20
0.25
6.12
37.99
5.59
0.04
0
4
1.34
6.68
15.53
15.53
4.42
3.40
2
10
0.92
0.53
0.67
-6.33
6.40
-4.66
17.91
6.56
0.71
0.71
0.75
1.22
11.34
4.08
0.16
3
9
-8.40
6.68
-4.42
19.22
8.06
0.88
2
15
0.90
0.53
0.59
-6.33
8.57
-4.66
21.56
6.51
0.74
0.64
0.80
1.69
14.82
3.59
-0.09
3
14
-8.40
10.01
-4.42
23.82
7.87
1.42
75
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Large Value Portfolios
High
1st Qt
Median
3rd Qt
Low
M Manning and Napier
Net Ret
Rank
1 Russell 1000 Value
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
10.35
8.74
7.95
6.72
4.75
8.24
42
7.36
67
10.50
9.56
8.87
7.49
6.04
9.16
36
8.67
59
9.92
8.96
8.20
7.31
5.53
7.91
57
8.59
39
11.20
10.32
9.46
8.43
6.63
9.91
33
9.70
41
12.22
10.68
9.90
8.64
7.20
9.95
48
9.87
53
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
M
1
M
1
M
1
M 1 M 1
Manning and Napier
Value Added Analysis - Net of Fee
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
-6.5
-1.3
0.0
-1.3 -1.0
0.5
1.2
-3.3
1.3
-0.4
2.3
0.7
1.3
-0.9
0.4
-3.7
2.2
1.6
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. Russell 1000 Value
76
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Manning and Napier
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 1000 Value
86
38,508,292
118,300,168
32,977,787
2.78
18.90
19.78
0.96
3.63
60.54
5.02
719
114,494,104
8,624,486
2.44
22.31
19.49
0.99
1.71
69.41
0.85
Ten Largest Holdings
Johnson & Johnson
J P Morgan Chase & C
Wells Fargo & Co New
Home Depot Inc
Wal Mart Stores Inc
Pfizer Inc
Pepsico Inc
Taiwan Semiconductor
Merck & Co Inc New
3m Co
Market Value % of Portfolio Quarterly Ret
1,630,210
1,436,351
1,275,261
1,082,851
1,073,521
1,038,569
957,528
950,842
940,841
881,685
4.24
3.74
3.32
2.82
2.79
2.70
2.49
2.47
2.45
2.29
6.91
4.65
0.24
5.08
5.69
-0.86
3.96
9.19
1.61
9.47
Ten Best Performers
Coca-Cola Femsa S A
McDonalds Corp
Best Buy Inc
Philips Elec(Kon)
Boeing Co
Smith & Nephew Plc
Whirlpool Corp
Abbvie Inc
Hasbro Bradley Inc
Corning Inc
Quarterly Ret
19.54
18.90
17.33
13.85
12.68
12.67
12.52
12.39
12.34
11.89
Ten Worst Performers
Grainger W W Inc
Fastenal Co
Intl Business McHn
C H Robinson Worldwi
Harley Davidson Inc
Honda Motor Ltd
Archer Daniels Midla
Smucker J M Co
Campbell Soup Co
Gap Inc
Quarterly Ret
-21.91
-14.88
-10.80
-10.54
-10.09
-9.48
-9.44
-9.19
-8.33
-7.63
77
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Manning and Napier
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 1000 Value
86
38,508,292
118,300,168
32,977,787
2.78
18.90
19.78
0.96
3.63
60.54
5.02
719
114,494,104
8,624,486
2.44
22.31
19.49
0.99
1.71
69.41
0.85
Ten Best Contributors
McDonalds Corp
Johnson & Johnson
Unilever Plc
Boeing Co
Abbvie Inc
Taiwan Semiconductor
3m Co
Medtronic Plc
J P Morgan Chase & C
Wal Mart Stores Inc
Market Value % of Portfolio Quarterly Ret
695,040
1,630,210
874,525
720,799
713,643
950,842
881,685
681,423
1,436,351
1,073,521
1.81
4.24
2.27
1.87
1.86
2.47
2.29
1.77
3.74
2.79
18.90
6.91
10.49
12.68
12.39
9.19
9.47
10.17
4.65
5.69
Ten Worst Contributors
Intl Business McHn
Cisco Sys Inc
Intel Corp
Honda Motor Ltd
Grainger W W Inc
Fastenal Co
China Pete & Chem Co
Archer Daniels Midla
Texas Instrs Inc
Lyondellbasell Indus
Market Value % of Portfolio Quarterly Ret
803,916
824,192
822,008
381,433
131,245
153,879
589,421
215,176
514,739
306,083
2.09
2.14
2.14
0.99
0.34
0.40
1.53
0.56
1.34
0.80
-10.80
-6.59
-5.77
-9.48
-21.91
-14.88
-3.57
-9.44
-3.92
-6.42
78
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Manning and Napier
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
3.17
4.01
20.84
7.69
16.56
15.46
10.91
18.75
2.62
0.00
100.00
12.20
2.92
10.05
4.47
8.47
10.84
26.59
9.92
3.60
6.26
100.00
-5.59
3.43
7.20
-0.42
1.44
5.32
2.98
-0.33
3.83
2.85
-7.09
0.16
3.36
2.79
0.70
6.02
3.75
0.47
-7.10
2.16
1.24
0.05
0.13
0.80
-0.25
0.12
-0.11
-0.08
-0.15
0.29
0.00
0.80
0.75
-0.01
0.23
0.05
-0.04
0.22
-0.39
-0.07
0.08
-0.06
0.76
0.80
0.12
1.03
-0.20
0.08
0.11
-0.48
-0.22
0.37
-0.06
1.56
Index - Russell 1000 Value
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.36%
[ Actual Return 3.21% ] - [ Buy Hold Return 2.85% ]
79
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Manning and Napier
Quarter Ending 6/17
% Allocation
Energy 3.17 12.20
Materials 4.01 2.92
Industrials 20.84 10.05
Con. Discretionary 7.69 4.47
Consumer Staples 16.56 8.47
Health Care 15.46 10.84
Financials 10.91 26.59
Infomation Tech.18.75 9.92
Telecom. Services 2.62 3.60
Utilities 0.00 6.26
Manning and Napier Russell 1000 Value
% Return
-5.59 -7.09
3.43 0.16
7.20 3.36
-0.42 2.79
1.44 0.70
5.32 6.02
2.98 3.75
-0.33 0.47
3.83 -7.10
2.16
% Variance
0.80
0.12
1.03
-0.20
0.08
0.11
-0.48
-0.22
0.37
-0.06
80
City of Clearwater Employees Pension Fund
Mid Cap Equity Comp as of 6/30/17
Ihs Markit Ltd
Global Pmts Inc
S&P Global Inc
Lkq Corp
Delphi Automotive Pl
Transdigm Group Inc
Boston Scientific Co
Eqt Corp
Universal Health Svc
Regeneron Pharmaceut
GICS Sector % Port
Industrials
Information Technology
Financials
Consumer Discretionary
Consumer Discretionary
Industrials
Health Care
Energy
Health Care
Health Care
2.84
2.36
2.27
2.22
2.11
2.01
1.97
1.97
1.96
1.86
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
7.20
5.64
15.48
15.63
1.22
15.45
19.17
16.31
0.00
3.90
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
3/31/88
Mid Cap Equity Comp R Mid Cap
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
3/31/88
Mid Cap Equity Comp
R Mid Cap
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
5.09
2.70
76,853
144
3,909
80,906
12.36
7.99
75,957
-4,214
9,164
80,906
18.53
16.48
102,218
-34,941
13,628
80,906
8.29
7.69
110,978
-50,606
20,534
80,906
14.98
14.72
80,702
-64,617
64,821
80,906
9.19
7.67
92,247
-73,625
62,284
80,906
12.51
11.70
15,585
-73,625
138,946
80,906
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
81
City of Clearwater Employees Pension Fund
Mid Cap Equity Comp as of 6/30/17
Cash & Equiv
$4,338 5.36%
Domestic Equity
$76,568 94.64%
Periods from 3/88 to 6/17
Alpha
Beta
R-Squared
0.04
1.14
0.83
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0 24.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0 M
1
T
Annualized Standard Deviation%
M Mid Cap Equity Comp
1 R Mid Cap
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
12.51
11.70
3.30
21.77
17.31
1.31
0.42
0.49
0.00
0.12
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
82
City of Clearwater Employees Pension Fund
Midcap Neutral Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
M Mid Cap Equity Comp
Net Ret
Rank
1 R Mid Cap
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
4.01
3.28
2.20
1.24
-1.06
5.09
1
2.70
46
24.41
21.83
20.37
18.05
10.63
18.53
69
16.48
87
11.44
10.60
9.18
8.10
4.66
6.90
79
8.23
72
10.60
9.67
8.25
6.55
3.67
8.29
47
7.69
56
13.91
12.53
12.26
10.86
9.21
12.61
22
12.19
56
16.69
15.87
14.72
13.95
12.11
14.98
32
14.72
50
14.07
12.87
11.98
11.42
9.90
12.66
39
11.81
60
16.77
16.31
15.62
14.46
13.04
16.42
13
15.28
57
18.90
18.23
16.83
15.12
14.16
17.58
37
16.47
58
14.16
12.23
11.20
10.39
9.36
11.62
42
10.00
89
9.20
9.11
8.27
7.85
7.47
9.19
7
7.67
81
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
26%
M
1
M
1
M
1 M1
M1
M1
M1
M
1
M
1
M
1 M
1
83
City of Clearwater Employees Pension Fund
Midcap Neutral Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
M Mid Cap Equity Comp
Net Ret
Rank
1 R Mid Cap
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
10.91
8.20
6.03
5.05
2.04
12.36
2
7.99
36
24.48
20.73
17.87
15.13
5.53
6.73
92
13.80
81
3.35
-1.75
-4.87
-9.09
-10.50
-1.30
20
-2.44
40
20.03
14.45
9.87
5.49
2.67
13.38
25
13.21
25
49.42
40.92
36.54
33.64
24.89
37.36
42
34.76
66
23.73
19.63
17.97
16.83
11.91
22.00
13
17.26
72
9.52
2.50
-0.48
-1.83
-4.69
-0.10
37
-1.56
55
43.18
28.36
26.70
23.30
19.30
28.03
28
25.49
59
62.84
39.29
37.27
33.05
28.44
45.33
9
40.47
21
-27.10
-33.96
-36.20
-37.35
-39.64
-41.79
100
-41.46
100
11.40
9.14
8.19
6.10
-17.23
10.26
13
5.59
76
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
M
1 M
1
M1
M1
M1
M
1
M1
M1
M
1
M1
M
1
84
City of Clearwater Employees Pension Fund
Risk Measure Summary
Mid Cap Equity Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.12
0.75
0.34
6.92
18.53
18.53
5.64
1.18
-0.20
0.61
3.20
15.30
4.69
0.39
0
4
2.70
5.15
16.48
16.48
2.26
7.06
3
9
0.96
0.76
0.67
-7.57
8.26
-6.64
18.53
8.76
1.00
0.17
0.79
0.92
8.09
4.06
0.14
3
9
-8.01
5.94
-4.04
17.03
7.81
0.96
3
17
0.98
0.76
0.55
-7.57
12.83
-6.64
37.36
9.30
1.01
0.04
0.84
1.59
14.66
3.79
0.06
3
17
-8.01
12.95
-4.04
34.76
8.41
1.73
34
83
1.13
1.15
0.56
-26.78
49.24
-41.79
77.74
21.77
1.14
0.04
0.83
0.42
8.09
9.41
0.12
35
82
-27.28
20.80
-41.46
67.72
17.31
0.49
85
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Midcap Neutral Portfolios
Annualized Rate of Return7.0 7.55 8.1 8.65 9.2 9.75 10.3 10.85 11.4 11.95 12.5
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
M
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
M Mid Cap Equity Comp
1 R Mid Cap
Median
8.29 47 8.76 12
7.69 56 7.81 1
8.25 9.70
Annualized Rate of Return6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0 14.0
11.0
11.7
12.5
13.2
14.0
14.7
15.5
16.2
17.0
17.7
18.5
M1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
M Mid Cap Equity Comp
1 R Mid Cap
Median
14.98 32 9.30 44
14.72 50 8.41 5
14.72 9.74
86
City of Clearwater Employees Pension Fund
Artisan Partners as of 6/30/17
Ihs Markit Ltd
Global Pmts Inc
S&P Global Inc
Lkq Corp
Boston Scientific Co
Regeneron Pharmaceut
Cigna Corp
Waste Connections In
Veeva Sys Inc
Becton Dickinson
GICS Sector % Port
Industrials
Information Technology
Financials
Consumer Discretionary
Health Care
Health Care
Health Care
Industrials
Health Care
Health Care
5.37
4.45
4.28
4.20
3.73
3.51
2.84
2.32
2.27
2.20
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
4.20
1.99
18.80
17.90
2.31
19.33
13.80
21.68
0.00
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
7/31/01
Artisan Partners R Mid Cap G
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
7/31/01
Artisan Partners
R Mid Cap G
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
6.81
4.21
39,681
84
2,703
42,468
15.33
11.40
36,678
163
5,627
42,468
17.20
17.05
49,637
-13,685
6,517
42,468
7.18
7.83
52,974
-19,498
8,992
42,468
13.70
14.20
40,076
-27,505
29,897
42,468
10.02
7.87
24,919
-32,510
50,060
42,468
9.91
8.10
29,914
-32,510
45,065
42,468
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
87
City of Clearwater Employees Pension Fund
Artisan Partners as of 6/30/17
Cash & Equiv
$1,961 4.62%
Domestic Equity
$40,508 95.38%
Periods from 7/01 to 6/17
Alpha
Beta
R-Squared
0.47
0.94
0.92
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
r
1
T
Annualized Standard Deviation%
r Artisan Partners
1 R Mid Cap G
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
9.91
8.10
1.37
18.29
17.92
0.49
0.47
0.38
0.00
0.21
Asset Allocation ($000)
Risk/Return Analysis
88
City of Clearwater Employees Pension Fund
Midcap Growth Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
r Artisan Partners
Net Ret
Rank
1 R Mid Cap G
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
7.04
6.22
4.26
3.49
0.03
6.81
19
4.21
53
28.84
24.40
20.94
17.23
14.41
17.20
75
17.05
77
15.41
11.65
8.78
4.44
1.86
5.67
68
7.02
65
13.61
10.98
9.35
5.86
4.00
7.18
67
7.83
63
15.84
14.71
13.32
11.37
9.80
11.83
66
12.12
61
17.79
16.63
15.69
14.16
11.56
13.70
82
14.20
73
15.08
13.22
12.54
11.63
6.33
11.56
76
11.13
80
19.67
16.90
16.06
15.30
10.76
16.38
36
15.24
75
20.22
17.79
16.89
15.76
11.74
16.96
45
15.98
72
14.73
12.60
10.95
10.07
5.96
11.94
25
9.59
83
11.57
10.21
9.22
8.54
5.09
10.02
33
7.87
81
-5%
0%
5%
10%
15%
20%
25%
30%
r
1
r1
r
1 r1
r1
r1
r1
r1
r1
r
1 r
1
89
City of Clearwater Employees Pension Fund
Midcap Growth Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
r Artisan Partners
Net Ret
Rank
1 R Mid Cap G
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
16.85
13.44
11.46
9.12
4.35
15.33
13
11.40
57
20.76
13.81
8.36
4.00
2.22
-0.63
99
7.33
54
9.77
1.51
-1.14
-2.61
-6.44
3.38
13
-0.20
39
13.79
10.51
8.91
6.10
3.17
6.96
67
11.91
14
43.46
39.53
37.97
34.40
30.88
39.21
28
35.76
67
22.65
20.16
17.14
15.78
10.47
20.82
18
15.80
73
9.45
2.60
-0.41
-4.56
-9.81
0.07
43
-1.66
63
38.12
31.63
27.77
26.45
19.71
33.15
12
26.39
75
51.99
44.53
41.56
38.11
30.82
51.38
5
46.30
14
-32.14
-35.11
-38.94
-40.25
-44.66
-42.87
85
-44.32
91
25.75
22.03
12.92
5.77
1.06
22.31
22
11.41
53
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
r
1
r
1
r1
r
1
r1
r
1
r1
r
1
r
1
r1
r
1
90
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Midcap Growth Portfolios
High
1st Qt
Median
3rd Qt
Low
r Artisan Partners
Net Ret
Rank
1 R Mid Cap G
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
13.41
10.98
9.58
6.42
4.77
7.18
71
7.83
65
12.12
10.18
7.53
5.76
4.57
4.90
88
7.88
46
9.78
9.19
6.93
4.35
3.06
3.19
93
6.23
57
11.87
10.58
9.28
6.74
5.43
6.73
75
8.90
50
14.35
11.76
10.76
7.97
7.00
10.09
54
10.52
52
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
14%
15%
r
1
r
1
r
1
r
1
r 1
Artisan Partners
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-7.0%
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
0.5
0.0
-2.2
0.6
6.2
-1.8
0.7
-4.1
-1.1
0.0
-1.2
3.1
1.0
0.7
-6.1
1.9
1.2
-4.4
1.0
2.5
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R Mid Cap G
91
City of Clearwater Employees Pension Fund
Risk Measure Summary
Artisan Partners
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.01
0.75
-3.98
7.97
17.20
17.20
10.99
1.55
-2.05
0.83
1.52
10.75
6.22
0.05
0
4
0.46
6.89
17.05
17.05
5.33
3.11
4
8
0.85
0.72
0.67
-7.04
7.97
-6.20
17.20
10.30
1.05
-0.21
0.72
0.67
6.61
5.51
-0.11
3
9
-7.99
6.89
-4.75
17.05
8.27
0.92
4
16
0.93
0.72
0.65
-7.04
16.16
-6.20
39.21
10.69
1.05
-0.24
0.71
1.27
12.88
5.80
-0.07
3
17
-7.99
11.52
-4.75
35.76
8.54
1.64
18
45
1.00
0.89
0.49
-27.54
26.70
-42.87
58.59
19.20
0.94
0.47
0.92
0.53
10.77
5.44
0.21
18
45
-27.36
27.06
-44.32
62.98
19.58
0.44
92
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Midcap Growth Portfolios
Annualized Rate of Return6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0 14.0
2.0
3.5
5.0
6.5
8.0
9.5
11.0
12.5
14.0
15.5
17.0
r1MedianRisk Median
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
r Artisan Partners
1 R Mid Cap G
Median
7.18 67 10.30 67
7.83 63 8.27 20
9.35 9.86
Annualized Rate of Return5.0 5.9 6.8 7.7 8.6 9.5 10.4 11.3 12.2 13.1 14.0
11.0
11.9
12.7
13.6
14.5
15.4
16.3
17.2
18.1
19.0
19.9
r
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
r Artisan Partners
1 R Mid Cap G
Median
13.70 82 10.69 81
14.20 73 8.54 17
15.69 9.43
93
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Artisan Partners
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R Mid Cap G
61
40,507,751
19,701,811
12,425,915
0.57
42.73
27.70
1.02
3.87
58.46
7.07
426
13,712,755
7,826,038
1.05
35.13
24.83
1.07
5.38
67.48
8.40
Ten Largest Holdings
Ihs Markit Ltd
Global Pmts Inc
S&P Global Inc
Lkq Corp
Boston Scientific Co
Regeneron Pharmaceut
Cigna Corp
Waste Connections In
Veeva Sys Inc
Becton Dickinson
Market Value % of Portfolio Quarterly Ret
2,174,255
1,803,781
1,733,631
1,701,505
1,508,827
1,421,359
1,151,643
938,728
919,466
891,458
5.37
4.45
4.28
4.20
3.73
3.51
2.84
2.32
2.27
2.20
4.98
11.96
11.99
12.57
11.46
26.74
14.27
9.75
19.56
6.76
Ten Best Performers
Regeneron Pharmaceut
Edwards Lifesciences
Athenahealth Inc
Tableau Software Inc
Guidewire Software I
Veeva Sys Inc
Expedia Inc Del
Electronic Arts
Atlassian Corp Plc
Wabtec Corp
Quarterly Ret
26.74
25.69
24.72
23.65
21.98
19.56
18.29
18.10
17.46
17.45
Ten Worst Performers
Advance Auto Parts
Seattle Genetics Inc
Helmerich & Payne In
Diamondback Energy I
Dexcom Inc
Middleby Corp
Cbs Corp
Chipotle Mexican Gri
Svb Finl Group
Concho Res Inc
Quarterly Ret
-21.32
-17.69
-17.36
-14.37
-13.67
-10.95
-7.77
-6.60
-5.54
-5.31
94
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Artisan Partners
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R Mid Cap G
61
40,507,751
19,701,811
12,425,915
0.57
42.73
27.70
1.02
3.87
58.46
7.07
426
13,712,755
7,826,038
1.05
35.13
24.83
1.07
5.38
67.48
8.40
Ten Best Contributors
Regeneron Pharmaceut
Global Pmts Inc
Lkq Corp
S&P Global Inc
Veeva Sys Inc
Boston Scientific Co
Guidewire Software I
Cigna Corp
Edwards Lifesciences
Newell Rubbermaid In
Market Value % of Portfolio Quarterly Ret
1,421,359
1,803,781
1,701,505
1,733,631
919,466
1,508,827
749,008
1,151,643
507,368
888,162
3.51
4.45
4.20
4.28
2.27
3.73
1.85
2.84
1.25
2.19
26.74
11.96
12.57
11.99
19.56
11.46
21.98
14.27
25.69
14.17
Ten Worst Contributors
Advance Auto Parts
Dexcom Inc
Diamondback Energy I
Helmerich & Payne In
Middleby Corp
Concho Res Inc
Cbs Corp
Svb Finl Group
Chipotle Mexican Gri
Seattle Genetics Inc
Market Value % of Portfolio Quarterly Ret
382,532
553,453
499,467
322,562
437,922
880,606
569,173
564,110
231,768
44,755
0.94
1.37
1.23
0.80
1.08
2.17
1.41
1.39
0.57
0.11
-21.32
-13.67
-14.37
-17.36
-10.95
-5.31
-7.77
-5.54
-6.60
-17.69
95
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Artisan Partners
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
4.31
1.68
20.53
18.43
2.16
20.34
11.45
21.10
0.00
0.00
100.00
1.30
5.15
14.84
22.98
7.06
15.56
5.34
22.26
0.19
0.00
100.00
-12.32
0.60
3.34
5.18
5.75
10.91
8.65
12.88
7.17
-8.81
6.32
1.10
-0.40
-1.97
11.24
6.00
8.44
-6.08
0.00
4.08
-0.15
-0.10
0.46
1.03
0.17
-0.07
0.30
0.94
0.00
0.00
2.58
-0.39
-0.08
-0.17
0.20
0.30
0.34
0.12
-0.05
0.02
-0.00
0.29
-0.54
-0.17
0.29
1.23
0.46
0.28
0.42
0.88
0.02
0.00
2.87
Index - R Mid Cap G
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.13%
[ Actual Return 7.30% ] - [ Buy Hold Return 7.17% ]
96
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Artisan Partners
Quarter Ending 6/17
% Allocation
Energy 4.31 1.30
Materials 1.68 5.15
Industrials 20.53 14.84
Con. Discretionary 18.43 22.98
Consumer Staples 2.16 7.06
Health Care 20.34 15.56
Financials 11.45 5.34
Infomation Tech.21.10 22.26
Telecom. Services 0.00 0.19
Utilities 0.00 0.00
Artisan Partners R Mid Cap G
% Return
-12.32 -8.81
0.60 6.32
3.34 1.10
5.18 -0.40
5.75 -1.97
10.91 11.24
8.65 6.00
12.88 8.44
-6.08
% Variance
-0.54
-0.17
0.29
1.23
0.46
0.28
0.42
0.88
0.02
0.00
97
City of Clearwater Employees Pension Fund
Wedge Capital Mgmt as of 6/30/17
Transdigm Group Inc
Eqt Corp
Universal Health Svc
Zimmer Hldgs Inc
Ally Finl Inc
Great Plains Energy
Murphy Oil Corp
Wyndham Worldwide Co
Fidelity National Fi
Mednax Inc
GICS Sector % Port
Industrials
Energy
Health Care
Health Care
Financials
Utilities
Energy
Consumer Discretionary
Financials
Health Care
4.28
4.18
4.17
3.92
3.47
3.38
3.29
3.24
3.05
2.99
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
10.57
9.76
11.75
13.08
0.00
11.08
25.20
10.27
0.00
8.29
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
2/28/07
Wedge Capital Mgmt R Mid Cap V
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
2/28/07
Wedge Capital Mgmt
R Mid Cap V
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
3.24
1.37
37,172
59
1,206
38,437
9.37
5.18
39,278
-4,378
3,537
38,437
19.68
15.93
52,582
-21,256
7,112
38,437
9.29
7.46
58,004
-31,108
11,541
38,437
16.06
15.14
40,626
-37,113
34,923
38,437
9.09
7.23
32,228
-41,115
47,324
38,437
9.41
7.48
30,365
-41,115
49,187
38,437
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
98
City of Clearwater Employees Pension Fund
Wedge Capital Mgmt as of 6/30/17
Cash & Equiv
$2,377 6.18%
Domestic Equity
$36,060 93.82%
Periods from 2/07 to 6/17
Alpha
Beta
R-Squared
0.48
0.99
0.96
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
w
1
T
Annualized Standard Deviation%
w Wedge Capital Mgmt
1 R Mid Cap V
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
9.41
7.48
0.72
18.02
17.91
0.43
0.48
0.38
0.00
0.44
Asset Allocation ($000)
Risk/Return Analysis
99
City of Clearwater Employees Pension Fund
Midcap Value Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
w Wedge Capital Mgmt
Net Ret
Rank
1 R Mid Cap V
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
3.12
1.85
1.47
0.71
-6.84
3.24
1
1.37
50
22.44
21.43
15.96
12.76
-1.59
19.68
35
15.93
50
15.04
14.62
9.76
7.72
-6.38
8.02
71
9.40
60
9.96
9.23
8.95
7.38
-8.07
9.29
13
7.46
70
14.03
13.05
11.69
9.11
-0.13
13.14
25
12.21
39
16.60
14.12
12.88
9.82
7.06
16.06
8
15.14
12
13.22
12.25
11.03
9.72
6.92
13.57
1
12.39
15
16.33
15.29
18.04
16.91
12.21
10.34
9.09
7.23
-10%
-5%
0%
5%
10%
15%
20%
25%
w
1
w
1
w
1 w
1
w1
w1
w1
w1
w1
w
1
w
1
100
City of Clearwater Employees Pension Fund
Midcap Value Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
w Wedge Capital Mgmt
Net Ret
Rank
1 R Mid Cap V
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009
9.31
6.77
3.90
3.11
1.53
9.37
1
5.18
32
32.10
31.00
22.19
16.92
13.50
14.46
83
20.00
57
2.87
-2.28
-3.22
-11.29
-31.45
-5.72
64
-4.78
64
13.17
12.03
9.00
7.88
6.27
19.82
1
14.74
1
46.27
44.14
34.05
31.22
26.69
34.92
46
33.45
58
32.17
18.21
16.03
12.41
11.55
23.16
12
18.48
25
8.95
6.35
-1.12
-5.17
-7.49
-0.33
45
-1.38
52
34.93
28.13
19.86
19.43
16.95
23.30
40
24.76
37
61.66
57.20
38.68
29.76
22.89
38.51
51
34.20
56
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
w
1
w
1
w 1
w
1
w 1
w
1
w 1
w 1
w
1
101
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Midcap Value Portfolios
High
1st Qt
Median
3rd Qt
Low
w Wedge Capital Mgmt
Net Ret
Rank
1 R Mid Cap V
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
9.96
9.25
9.09
8.08
6.97
9.29
20
7.46
87
11.42
10.98
10.26
9.39
6.62
9.73
71
8.94
87
12.52
11.51
10.91
8.67
2.88
8.94
61
9.45
55
14.32
11.36
10.23
9.19
4.88
10.28
42
10.49
35
13.78
12.21
11.31
10.12
6.76
11.04
58
10.99
58
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
14%
15%
w
1
w
1 w
1
w 1
w 1
Wedge Capital Mgmt
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
-0.2
0.5
2.0
-1.7
0.7
0.1
-1.5
-1.1
2.7
4.3
0.4 0.3
-0.1
-1.6
-2.5
-1.5
0.0
-0.7
2.1
1.9
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R Mid Cap V
102
City of Clearwater Employees Pension Fund
Risk Measure Summary
Wedge Capital Mgmt
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.24
0.75
3.24
5.93
19.68
19.68
2.20
0.87
1.30
0.73
8.71
22.10
2.86
1.15
0
4
1.37
5.52
15.93
15.93
3.53
4.38
3
9
1.07
0.79
0.58
-8.10
10.66
-7.12
19.68
9.08
0.98
0.48
0.80
1.00
9.23
4.12
0.42
3
9
-8.04
6.05
-4.78
20.00
8.29
0.87
4
16
1.01
0.79
0.55
-8.10
16.49
-7.12
34.92
9.88
1.03
0.12
0.87
1.61
15.43
3.58
0.23
3
17
-8.04
14.21
-4.78
33.45
8.96
1.67
14
27
1.03
0.91
0.63
-26.40
25.65
-39.75
73.15
19.71
0.99
0.48
0.96
0.44
8.77
4.03
0.44
13
28
-27.19
23.62
-42.51
72.41
19.51
0.35
103
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Midcap Value Portfolios
Annualized Rate of Return4.0 5.4 6.8 8.2 9.6 11.0 12.4 13.8 15.2 16.6 18.0
0.0
1.8
3.6
5.3
7.2
9.0
10.8
12.6
14.4
16.2
18.0
w
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
w Wedge Capital Mgmt
1 R Mid Cap V
Median
9.29 13 9.08 43
7.46 70 8.29 39
8.95 10.94
Annualized Rate of Return5.5 6.15 6.8 7.45 8.1 8.75 9.4 10.05 10.7 11.35 12.0
4.0
5.8
7.6
9.4
11.2
13.0
14.8
16.6
18.4
20.1
21.9
w
1MedianRisk
Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
w Wedge Capital Mgmt
1 R Mid Cap V
Median
16.06 8 9.88 69
15.14 12 8.96 61
12.88 8.62
104
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Wedge Capital Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R Mid Cap V
44
36,060,147
10,639,293
8,337,271
1.85
21.83
17.57
1.09
1.97
75.36
4.42
590
13,312,522
6,839,792
2.19
29.09
19.81
0.99
1.83
75.27
3.68
Ten Largest Holdings
Transdigm Group Inc
Eqt Corp
Universal Health Svc
Zimmer Hldgs Inc
Ally Finl Inc
Great Plains Energy
Murphy Oil Corp
Wyndham Worldwide Co
Fidelity National Fi
Mednax Inc
Market Value % of Portfolio Quarterly Ret
1,539,281
1,505,763
1,501,584
1,412,400
1,249,820
1,215,120
1,185,054
1,164,756
1,098,335
1,074,586
4.28
4.18
4.17
3.92
3.47
3.38
3.29
3.24
3.05
2.99
22.12
-4.06
-1.82
5.35
3.21
1.16
-9.52
19.83
15.80
-12.99
Ten Best Performers
Packaging Corp Amer
Transdigm Group Inc
Wyndham Worldwide Co
Owens Ill Inc
Dana Holding Corp
Fidelity National Fi
Cit Group Inc
Convergys Corp
Royal Caribbean Crui
Dxc Technology Co
Quarterly Ret
22.30
22.12
19.83
17.37
15.97
15.80
13.80
12.90
11.82
11.44
Ten Worst Performers
Weatherford Intl Plc
Technipfmc Ltd
Mednax Inc
Murphy Oil Corp
Cbl & Assoc Pptys In
TCF Bkg & Svgs Fa Mi
Eqt Corp
Signature Bk New Yor
Universal Health Svc
UGI Corp New
Quarterly Ret
-41.80
-16.31
-12.99
-9.52
-8.87
-5.91
-4.06
-3.28
-1.82
-1.51
105
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Wedge Capital Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R Mid Cap V
44
36,060,147
10,639,293
8,337,271
1.85
21.83
17.57
1.09
1.97
75.36
4.42
590
13,312,522
6,839,792
2.19
29.09
19.81
0.99
1.83
75.27
3.68
Ten Best Contributors
Transdigm Group Inc
Packaging Corp Amer
Wyndham Worldwide Co
Fidelity National Fi
Owens Ill Inc
Dana Holding Corp
Marvell Technology G
Cit Group Inc
Zimmer Hldgs Inc
Delphi Automotive Pl
Market Value % of Portfolio Quarterly Ret
1,539,281
1,058,205
1,164,756
1,098,335
820,456
756,987
1,025,892
637,970
1,412,400
788,850
4.28
2.94
3.24
3.05
2.28
2.10
2.85
1.77
3.92
2.19
22.12
22.30
19.83
15.80
17.37
15.97
8.65
13.80
5.35
9.26
Ten Worst Contributors
Weatherford Intl Plc
Mednax Inc
Murphy Oil Corp
Eqt Corp
Technipfmc Ltd
Universal Health Svc
Cbl & Assoc Pptys In
TCF Bkg & Svgs Fa Mi
UGI Corp New
Signature Bk New Yor
Market Value % of Portfolio Quarterly Ret
887,004
1,074,586
1,185,054
1,505,763
225,760
1,501,584
269,760
344,224
704,366
288,208
2.46
2.99
3.29
4.18
0.63
4.17
0.75
0.96
1.96
0.80
-41.80
-12.99
-9.52
-4.06
-16.31
-1.82
-8.87
-5.91
-1.51
-3.28
106
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Wedge Capital Mgmt
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
11.63
9.41
12.23
13.34
0.00
10.54
27.05
7.46
0.00
8.34
100.00
9.62
6.12
12.94
8.51
3.26
4.13
19.83
9.14
1.18
11.25
100.00
-15.46
12.66
8.40
11.44
-2.64
5.12
9.34
1.13
3.84
-12.15
-0.00
3.13
4.32
0.02
8.29
3.22
2.89
-0.65
1.77
1.04
-0.39
1.19
0.64
0.95
0.00
-1.15
0.51
0.48
0.00
-0.05
2.19
-0.26
-0.03
-0.01
0.16
0.03
0.46
0.16
-0.03
0.02
-0.02
0.47
-0.65
1.16
0.63
1.11
0.03
-0.69
0.67
0.45
0.02
-0.07
2.66
Index - R Mid Cap V
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.28%
[ Actual Return 3.56% ] - [ Buy Hold Return 3.84% ]
107
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Wedge Capital Mgmt
Quarter Ending 6/17
% Allocation
Energy 11.63 9.62
Materials 9.41 6.12
Industrials 12.23 12.94
Con. Discretionary 13.34 8.51
Consumer Staples 0.00 3.26
Health Care 10.54 4.13
Financials 27.05 19.83
Infomation Tech.7.46 9.14
Telecom. Services 0.00 1.18
Utilities 8.34 11.25
Wedge Capital Mgmt R Mid Cap V
% Return
-15.46 -12.15
12.66
8.40 3.13
11.44 4.32
0.02
-2.64 8.29
5.12 3.22
9.34 2.89
-0.65
1.13 1.77
% Variance
-0.65
1.16
0.63
1.11
0.03
-0.69
0.67
0.45
0.02
-0.07
108
City of Clearwater Employees Pension Fund
Small Cap Equity Comp as of 6/30/17
National Instrs Corp
Grand Canyon Ed Inc
Pegasystems Inc
Bio Techne Corp
Chemed Corp New
Proto Labs Inc
Health Care Group In
Athenahealth Inc
Dorman Products Inc
Knight Transn Inc
GICS Sector % Port
Information Technology
Consumer Discretionary
Information Technology
Health Care
Health Care
Industrials
Industrials
Health Care
Consumer Discretionary
Industrials
2.79
2.25
1.81
1.60
1.58
1.57
1.53
1.48
1.45
1.44
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
1.75
2.78
19.49
12.84
5.47
13.99
14.58
28.62
0.00
0.47
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
26.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
8/31/03
Small Cap Equity Comp R2000
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
8/31/03
Small Cap Equity Comp
R2000
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
5.01
2.46
50,327
118
2,520
52,965
8.68
4.99
51,413
-2,764
4,317
52,965
22.85
24.60
53,163
-10,541
10,344
52,965
8.54
7.36
69,342
-28,314
11,937
52,965
14.04
13.70
47,898
-30,320
35,388
52,965
8.15
6.92
69,785
-69,326
52,506
52,965
10.07
9.30
29,988
-69,326
92,303
52,965
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
109
City of Clearwater Employees Pension Fund
Small Cap Equity Comp as of 6/30/17
Cash & Equiv
$1,275 2.41%
Domestic Equity
$51,690 97.59%
Periods from 8/03 to 6/17
Alpha
Beta
R-Squared
0.38
0.90
0.95
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
S
1
T
Annualized Standard Deviation%
S Small Cap Equity Comp
1 R2000
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
10.07
9.30
1.29
17.47
18.46
0.51
0.50
0.43
0.00
0.12
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
110
City of Clearwater Employees Pension Fund
Small Neutral Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
S Small Cap Equity Comp
Net Ret
Rank
1 R2000
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
10.54
2.30
1.27
0.08
-1.41
5.01
7
2.46
21
30.94
26.00
23.94
21.48
15.64
22.85
58
24.60
42
13.36
11.87
9.90
8.00
1.96
9.86
50
7.80
83
12.07
9.88
8.08
7.18
1.38
8.54
36
7.36
65
14.92
13.58
12.09
11.41
8.69
11.43
73
11.22
79
18.03
16.34
15.38
13.84
12.40
14.04
71
13.70
78
14.65
12.95
12.15
11.19
9.49
12.26
45
10.91
82
17.94
16.02
15.45
14.80
13.58
16.09
20
14.35
84
19.39
17.48
16.65
15.50
14.75
16.39
58
15.22
84
14.47
12.98
11.44
10.34
9.07
11.38
51
9.85
88
10.35
9.30
8.61
7.91
6.56
8.15
67
6.92
87
-5%
0%
5%
10%
15%
20%
25%
30%
35%
S
1
S
1
S
1 S1
S1
S1
S1
S
1
S1
S
1
S1
111
City of Clearwater Employees Pension Fund
Small Neutral Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
S Small Cap Equity Comp
Net Ret
Rank
1 R2000
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
8.28
5.87
3.14
1.06
-2.31
8.68
4
4.99
34
36.55
28.26
25.79
23.53
16.93
18.26
91
21.31
84
1.60
-1.95
-3.68
-6.58
-16.71
-1.70
21
-4.41
60
10.28
8.23
5.42
1.51
-3.67
0.39
83
4.89
60
48.95
42.94
41.34
37.40
32.18
42.51
35
38.82
68
24.20
21.38
17.70
15.00
11.11
17.61
51
16.34
63
3.41
-0.32
-3.11
-5.63
-9.91
2.07
11
-4.17
60
35.59
31.17
29.95
23.59
20.47
29.27
52
26.85
62
48.66
37.58
33.62
27.78
22.82
33.51
55
27.19
76
-22.88
-30.16
-33.71
-36.46
-40.84
-38.63
89
-33.80
55
11.68
2.37
-2.28
-5.44
-10.76
3.27
19
-1.55
43
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
S1
S1
S1
S
1
S1
S1
S
1
S1
S
1
S
1
S
1
112
City of Clearwater Employees Pension Fund
Risk Measure Summary
Small Cap Equity Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.93
0.50
3.50
6.33
22.85
22.85
2.69
0.58
1.94
0.77
8.32
38.73
5.24
-0.34
0
4
2.46
9.05
24.60
24.60
7.48
3.22
2
10
0.94
0.76
0.58
-8.82
9.12
-5.01
22.85
10.70
0.80
0.59
0.95
0.78
10.35
3.59
0.22
3
9
-11.92
9.73
-9.76
26.22
12.99
0.55
3
17
0.95
0.76
0.55
-8.82
11.91
-5.01
42.51
10.62
0.87
0.48
0.93
1.31
15.93
3.31
0.04
3
17
-11.92
12.39
-9.76
38.82
11.75
1.15
15
40
0.96
0.87
0.60
-25.65
20.74
-38.63
57.55
17.25
0.90
0.38
0.95
0.53
10.09
4.19
0.12
16
39
-26.12
20.68
-37.50
62.77
18.65
0.44
113
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Small Neutral Portfolios
Annualized Rate of Return9.0 9.7 10.4 11.1 11.8 12.5 13.2 13.9 14.6 15.3 16.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
S
1MedianRisk Median
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
S Small Cap Equity Comp
1 R2000
Median
8.54 36 10.70 9
7.36 65 12.99 64
8.08 12.40
Annualized Rate of Return7.0 7.9 8.8 9.7 10.6 11.5 12.4 13.3 14.2 15.1 16.0
11.0
11.9
12.7
13.6
14.5
15.4
16.3
17.2
18.1
19.0
19.9
S 1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
S Small Cap Equity Comp
1 R2000
Median
14.04 71 10.62 28
13.70 78 11.75 58
15.38 11.48
114
City of Clearwater Employees Pension Fund
Riverbridge Partners as of 6/30/17
National Instrs Corp
Grand Canyon Ed Inc
Pegasystems Inc
Chemed Corp New
Proto Labs Inc
Health Care Group In
Athenahealth Inc
Ellie Mae Inc
Ultimate Software Gr
Costar Group Inc
GICS Sector % Port
Information Technology
Consumer Discretionary
Information Technology
Health Care
Industrials
Industrials
Health Care
Information Technology
Information Technology
Information Technology
4.62
4.31
3.46
3.03
3.01
2.92
2.84
2.64
2.60
2.57
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
0.00
0.00
18.51
13.43
5.45
19.87
4.20
38.54
0.00
0.00
-5.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
9/30/10
Riverbridge Partners R2000G
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
9/30/10
Riverbridge Partners
R2000G
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
8.79
4.39
25,302
62
2,224
27,588
17.38
9.97
23,399
118
4,071
27,588
28.26
24.40
21,317
222
6,049
27,588
10.09
7.64
33,487
-12,687
6,788
27,588
14.16
13.98
23,050
-12,690
17,228
27,588
15.52
13.71
16,876
-12,691
23,403
27,588
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
115
City of Clearwater Employees Pension Fund
Riverbridge Partners as of 6/30/17
Cash & Equiv
$609 2.21%
Domestic Equity
$26,979 97.79%
Periods from 9/10 to 6/17
Alpha
Beta
R-Squared
1.00
0.80
0.90
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0 R
1
T
Annualized Standard Deviation%
R Riverbridge Partners
1 R2000G
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
15.52
13.71
0.16
14.37
16.52
0.06
1.07
0.82
0.00
0.18
Asset Allocation ($000)
Risk/Return Analysis
116
City of Clearwater Employees Pension Fund
Small Growth Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
R Riverbridge Partners
Net Ret
Rank
1 R2000G
Net Ret
Rank
Last
Qtr
Last 2
Qtrs
Last 3
Qtrs
6/17
YTD
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
7.77
4.50
3.58
2.46
0.09
8.79
3
4.39
28
16.96
10.91
8.00
5.34
2.05
17.38
3
9.97
29
18.82
15.93
14.03
11.23
4.82
19.39
4
13.90
52
16.96
10.91
8.00
5.34
2.05
17.38
3
9.97
29
29.82
25.98
22.06
19.05
11.51
28.26
11
24.40
33
12.20
9.75
6.07
3.19
-0.61
11.60
10
5.37
62
12.79
10.17
7.93
5.38
2.61
10.09
25
7.64
52
15.89
13.61
11.78
9.59
7.76
11.99
46
11.68
51
19.11
15.63
14.55
13.22
10.07
14.16
58
13.98
60
15.32
13.53
11.80
9.79
7.65
12.95
33
11.01
60
-5%
0%
5%
10%
15%
20%
25%
30%
35%
R
1
R
1
R
1
R
1
R
1
R
1
R
1
R1
R1 R
1
117
City of Clearwater Employees Pension Fund
Small Growth Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
R Riverbridge Partners
Net Ret
Rank
1 R2000G
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011
16.96
10.91
8.00
5.34
2.05
17.38
3
9.97
29
26.84
19.26
15.44
9.00
1.85
13.29
56
11.32
64
4.97
1.03
-2.00
-4.02
-7.30
-3.15
62
-1.38
40
9.72
7.06
4.88
2.60
-5.11
0.20
82
5.60
38
52.44
45.90
42.19
38.44
31.42
43.50
42
43.29
43
22.18
17.99
15.27
12.53
9.58
17.83
26
14.59
58
10.13
4.27
0.65
-2.95
-9.68
4.27
25
-2.92
74
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
R
1
R 1
R 1 R
1
R 1
R
1
R
1
118
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Small Growth Portfolios
High
1st Qt
Median
3rd Qt
Low
R Riverbridge Partners
Net Ret
Rank
1 R2000G
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
12.45
9.78
7.93
5.69
3.55
10.09
24
7.64
52
10.60
8.69
7.19
5.16
3.37
6.20
65
6.72
57
9.28
7.57
6.03
3.21
1.71
3.21
75
5.05
63
10.51
8.53
7.08
5.41
3.99
5.22
77
6.59
57
12.72
9.95
8.48
7.39
5.64
7.04
82
7.74
71
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
R
1
R
1
R
1 R
1
R
1
Riverbridge Partners
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
-1.4
0.8
-0.9
1.1
0.3
-0.4
-1.4
-4.0
-0.4
0.7
-4.1
-0.8
5.0
-1.7
1.9
3.3
-1.6 -1.8
2.4
4.2
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R2000G
119
City of Clearwater Employees Pension Fund
Risk Measure Summary
Riverbridge Partners
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.16
0.50
1.71
8.79
28.26
28.26
6.42
0.91
1.35
0.57
4.32
30.68
6.30
0.51
0
4
3.57
9.22
24.40
24.40
5.00
4.78
3
9
1.01
0.77
0.50
-8.67
10.78
-7.97
28.26
12.29
0.83
0.88
0.83
0.80
11.91
5.64
0.35
3
9
-13.06
10.06
-11.84
24.40
13.52
0.55
5
15
0.93
0.77
0.45
-8.67
13.10
-7.97
43.50
11.90
0.87
0.46
0.85
1.17
16.05
4.92
-0.01
3
17
-13.06
13.20
-11.84
43.29
12.59
1.10
6
21
0.91
0.64
0.44
-15.89
16.39
-7.97
43.50
14.58
0.80
1.00
0.90
1.05
19.14
5.78
0.18
6
21
-22.26
17.11
-11.84
43.29
17.25
0.79
120
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Small Growth Portfolios
3 Years Ending 6/30/17
Annualized Rate of Return6.0 7.2 8.4 9.6 10.8 12.0 13.2 14.4 15.6 16.8 18.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
R
1MedianRisk Median
Return
Historical Standard Deviation of Return
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
R Riverbridge Partners
1 R2000G
Median
10.09 25 12.29 55
7.64 52 13.52 76
7.93 12.23
121
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Riverbridge Partners
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R2000G
54
26,978,513
2,960,240
2,042,188
0.50
57.53
35.89
1.12
3.98
13.74
6.70
1,171
2,231,130
930,735
0.69
100.79
19.42
1.17
4.10
42.89
8.21
Ten Largest Holdings
National Instrs Corp
Grand Canyon Ed Inc
Pegasystems Inc
Chemed Corp New
Proto Labs Inc
Health Care Group In
Athenahealth Inc
Ellie Mae Inc
Ultimate Software Gr
Costar Group Inc
Market Value % of Portfolio Quarterly Ret
1,245,694
1,162,036
933,658
816,075
812,716
788,243
765,014
711,447
701,810
694,322
4.62
4.31
3.46
3.03
3.01
2.92
2.84
2.64
2.60
2.57
24.25
9.50
33.14
12.10
31.60
9.12
24.72
9.61
7.61
27.21
Ten Best Performers
Freshpet Inc
Novadaq Technologies
Teladoc Inc
Pegasystems Inc
Proto Labs Inc
Costar Group Inc
Athenahealth Inc
National Instrs Corp
Alarm Com Hldgs Inc
Veeva Sys Inc
Quarterly Ret
50.91
50.45
38.80
33.14
31.60
27.21
24.72
24.25
22.41
19.56
Ten Worst Performers
Cheesecake Factory I
Financial Engines In
United Nat Foods Inc
Digi Intl Inc
Ritchie Bros Auction
Gentex Corp
Diplomat Pharmacy In
Wageworks Inc
U S Physical Therapy
Verint Sys Inc
Quarterly Ret
-20.29
-15.81
-15.11
-14.71
-12.17
-10.67
-7.21
-7.05
-6.93
-6.17
122
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Riverbridge Partners
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 2000 Growth
54
26,978,513
2,960,240
2,042,188
0.50
57.53
35.89
1.12
3.98
13.74
6.70
1,171
2,231,130
930,735
0.69
100.79
19.42
1.17
4.10
42.89
8.21
Ten Best Contributors
Pegasystems Inc
National Instrs Corp
Proto Labs Inc
Freshpet Inc
Athenahealth Inc
Costar Group Inc
Novadaq Technologies
Teladoc Inc
Grand Canyon Ed Inc
Alarm Com Hldgs Inc
Market Value % of Portfolio Quarterly Ret
933,658
1,245,694
812,716
453,562
765,014
694,322
298,544
308,136
1,162,036
459,538
3.46
4.62
3.01
1.68
2.84
2.57
1.11
1.14
4.31
1.70
33.14
24.25
31.60
50.91
24.72
27.21
50.45
38.80
9.50
22.41
Ten Worst Contributors
United Nat Foods Inc
Ritchie Bros Auction
Financial Engines In
Cheesecake Factory I
Gentex Corp
Digi Intl Inc
Wageworks Inc
Verint Sys Inc
U S Physical Therapy
Diplomat Pharmacy In
Market Value % of Portfolio Quarterly Ret
531,233
634,321
447,581
323,932
566,824
192,952
367,181
370,167
307,738
138,276
1.97
2.35
1.66
1.20
2.10
0.72
1.36
1.37
1.14
0.51
-15.11
-12.17
-15.81
-20.29
-10.67
-14.71
-7.05
-6.17
-6.93
-7.21
123
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Riverbridge Partners
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
0.00
0.00
18.13
15.19
4.73
20.14
4.59
37.21
0.00
0.00
100.00
1.26
5.48
15.80
14.79
3.03
21.89
5.68
25.05
0.77
0.82
100.00
6.40
2.21
7.89
12.63
0.16
12.30
9.00
-21.25
1.74
0.62
2.16
-1.22
9.54
-0.92
5.49
26.77
5.38
3.87
0.00
0.00
1.05
0.01
0.43
0.62
0.05
2.53
0.00
0.00
4.69
0.32
0.12
-0.08
-0.01
-0.09
-0.10
0.05
0.20
-0.18
-0.01
0.22
0.32
0.12
0.97
0.00
0.34
0.52
0.10
2.73
-0.18
-0.01
4.92
Index - R2000G
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.43%
[ Actual Return 9.43% ] - [ Buy Hold Return 9.00% ]
124
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Riverbridge Partners
Quarter Ending 6/17
% Allocation
Energy 0.00 1.26
Materials 0.00 5.48
Industrials 18.13 15.80
Con. Discretionary 15.19 14.79
Consumer Staples 4.73 3.03
Health Care 20.14 21.89
Financials 4.59 5.68
Infomation Tech.37.21 25.05
Telecom. Services 0.00 0.77
Utilities 0.00 0.82
Riverbridge Partners R2000G
% Return
-21.25
1.74
6.40 0.62
2.21 2.16
7.89 -1.22
12.63 9.54
0.16 -0.92
12.30 5.49
26.77
5.38
% Variance
0.32
0.12
0.97
0.00
0.34
0.52
0.10
2.73
-0.18
-0.01
125
City of Clearwater Employees Pension Fund
Atlanta Capital Mgmt as of 6/30/17
Manhattan Assocs Inc
Blackbaud Inc
Corelogic Inc
Aptargroup Inc
Choice Hotels Intl I
Wex Inc
Morningstar Inc
Fair Isaac Corp
Caseys Gen Stores
Exponet Inc
GICS Sector % Port
Information Technology
Information Technology
Information Technology
Materials
Consumer Discretionary
Information Technology
Financials
Information Technology
Consumer Staples
Industrials
3.83
3.36
3.29
3.08
2.87
2.84
2.74
2.71
2.64
2.47
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
1.18
4.86
25.18
15.28
7.63
7.25
17.61
21.01
0.00
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
26.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
8/31/03
Atlanta Capital Mgmt Russell 2000
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
8/31/03
Atlanta Capital Mgmt
Russell 2000
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
3.22
2.46
12,602
26
405
13,033
4.31
4.99
15,409
-2,944
568
13,033
14.15
24.60
17,996
-6,884
1,921
13,033
10.47
7.36
17,266
-8,816
4,583
13,033
15.27
13.94
13,363
-10,818
10,488
13,033
11.83
6.18
18,131
-20,819
15,722
13,033
12.51
9.34
14,990
-20,819
18,863
13,033
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
126
City of Clearwater Employees Pension Fund
Atlanta Capital Mgmt as of 6/30/17
Cash & Equiv
$518 3.98%
Domestic Equity
$12,515 96.02%
Periods from 8/03 to 6/17
Alpha
Beta
R-Squared
1.24
0.73
0.90
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0 t
1
T
Annualized Standard Deviation%
t Atlanta Capital Mgmt
1 Russell 2000
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
12.51
9.34
1.29
15.42
18.42
0.51
0.73
0.44
0.00
0.31
Asset Allocation ($000)
Risk/Return Analysis
127
City of Clearwater Employees Pension Fund
Small Neutral Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
t Atlanta Capital Mgmt
Net Ret
Rank
1 Russell 2000
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
10.54
2.30
1.27
0.08
-1.41
3.22
13
2.46
21
30.94
26.00
23.94
21.48
15.64
14.15
98
24.60
42
13.36
11.87
9.90
8.00
1.96
9.27
55
7.80
83
12.07
9.88
8.08
7.18
1.38
10.47
18
7.36
65
14.92
13.58
12.09
11.41
8.69
13.04
30
11.22
79
18.03
16.34
15.38
13.84
12.40
15.27
56
13.94
74
14.65
12.95
12.15
11.19
9.49
13.18
18
11.22
73
17.94
16.02
15.45
14.80
13.58
17.04
9
13.89
87
19.39
17.48
16.65
15.50
14.75
17.32
27
15.24
84
14.47
12.98
11.44
10.34
9.07
14.05
5
9.82
88
10.35
9.30
8.61
7.91
6.56
11.83
1
6.18
95
-5%
0%
5%
10%
15%
20%
25%
30%
35%
t1
t
1
t
1
t
1
t
1
t1 t
1
t
1
t
1 t
1
t
1
128
City of Clearwater Employees Pension Fund
Small Neutral Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
t Atlanta Capital Mgmt
Net Ret
Rank
1 Russell 2000
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
8.28
5.87
3.14
1.06
-2.31
4.31
35
4.99
34
36.55
28.26
25.79
23.53
16.93
18.02
92
21.31
84
1.60
-1.95
-3.68
-6.58
-16.71
4.97
1
-4.41
60
10.28
8.23
5.42
1.51
-3.67
3.50
69
4.89
60
48.95
42.94
41.34
37.40
32.18
42.43
35
37.88
72
24.20
21.38
17.70
15.00
11.11
12.53
93
18.05
45
3.41
-0.32
-3.11
-5.63
-9.91
10.20
1
-5.50
71
35.59
31.17
29.95
23.59
20.47
25.98
66
24.51
72
48.66
37.58
33.62
27.78
22.82
26.83
76
20.57
95
-22.88
-30.16
-33.71
-36.46
-40.84
-19.52
1
-28.92
12
11.68
2.37
-2.28
-5.44
-10.76
6.91
13
-9.77
88
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
t1
t1
t
1
t1
t
1
t
1
t
1
t1 t
1
t
1
t
1
129
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Small Cap Neutral Portfolios
High
1st Qt
Median
3rd Qt
Low
t Atlanta Capital Mgmt
Net Ret
Rank
1 Russell 2000
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
12.07
9.91
8.18
7.25
5.76
10.47
18
7.36
68
11.93
10.01
8.64
7.62
4.77
9.37
34
7.22
82
12.39
9.66
8.67
7.03
5.46
8.64
53
6.74
84
11.18
9.53
8.05
7.04
5.76
9.89
21
6.71
85
11.57
10.10
8.74
7.82
6.62
12.67
1
7.08
91
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
t
1
t
1
t
1
t
1
t
1
Atlanta Capital Mgmt
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
-1.4
-0.7
0.2
1.2
0.0
1.8
-2.1 -1.8
2.3
0.3
2.3
1.0
5.2
1.1
5.4
0.1
-6.2
-1.7 -1.4
0.7
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. Russell 2000
130
City of Clearwater Employees Pension Fund
Risk Measure Summary
Atlanta Capital Mgmt
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.58
0.25
1.06
7.00
14.15
14.15
5.13
0.47
0.67
0.52
2.66
29.35
6.36
-1.43
0
4
2.46
9.05
24.60
24.60
7.48
3.22
2
10
0.90
0.45
0.75
-7.38
10.08
2.12
18.02
9.82
0.67
1.27
0.78
1.04
15.19
6.29
0.38
3
9
-11.92
9.73
-9.76
26.22
12.99
0.55
3
17
0.91
0.45
0.65
-7.38
11.87
2.12
42.43
9.99
0.78
1.03
0.80
1.51
19.48
5.20
0.17
3
17
-11.92
11.63
-9.76
37.88
11.63
1.18
14
41
0.89
0.57
0.62
-16.60
18.00
-24.55
52.53
14.43
0.73
1.24
0.90
0.80
15.86
6.85
0.31
15
40
-24.89
22.70
-38.89
65.05
18.82
0.44
131
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Small Neutral Portfolios
Annualized Rate of Return9.0 9.7 10.4 11.1 11.8 12.5 13.2 13.9 14.6 15.3 16.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
t
1MedianRisk Median
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
t Atlanta Capital Mgmt
1 Russell 2000
Median
10.47 18 9.82 1
7.36 65 12.99 64
8.08 12.40
Annualized Rate of Return7.0 7.9 8.8 9.7 10.6 11.5 12.4 13.3 14.2 15.1 16.0
11.0
11.9
12.7
13.6
14.5
15.4
16.3
17.2
18.1
19.0
19.9
t
1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
t Atlanta Capital Mgmt
1 Russell 2000
Median
15.27 56 9.99 3
13.94 74 11.63 53
15.38 11.48
132
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Atlanta Capital Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 2000
56
12,515,257
3,275,437
2,898,725
0.93
28.65
28.30
0.97
3.54
47.25
7.49
2,008
2,042,853
792,019
1.29
55.41
18.06
1.13
2.14
49.24
4.87
Ten Largest Holdings
Manhattan Assocs Inc
Blackbaud Inc
Corelogic Inc
Aptargroup Inc
Choice Hotels Intl I
Wex Inc
Morningstar Inc
Fair Isaac Corp
Caseys Gen Stores
Exponet Inc
Market Value % of Portfolio Quarterly Ret
479,399
420,604
411,242
384,790
359,158
355,561
342,424
338,487
329,577
308,349
3.83
3.36
3.29
3.08
2.87
2.84
2.74
2.71
2.64
2.47
-7.67
12.01
6.53
13.27
2.98
0.74
-0.03
8.11
-4.38
-1.76
Ten Best Performers
Integra Lifesciences
Universal Health Rlt
National Instrs Corp
Knight Transn Inc
Graco Inc
Bio Techne Corp
Raven Inds Inc
Artisan Partners Ass
Bio Rad Labs Inc
Aptargroup Inc
Quarterly Ret
29.39
24.38
24.25
18.39
16.53
15.93
15.15
13.62
13.53
13.27
Ten Worst Performers
Hibbett Sports Inc
Monro Muffler Brake
Dril-Quip Inc
RLI Corp
Manhattan Assocs Inc
Prosperity Bancshare
Balchem Corp
Pinnacle Finl Partne
Kirby Expl Co.
Lancaster Colony Cor
Quarterly Ret
-29.66
-19.57
-10.54
-8.65
-7.67
-7.38
-5.71
-5.29
-5.24
-4.41
133
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Atlanta Capital Mgmt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio Russell 2000
56
12,515,257
3,275,437
2,898,725
0.93
28.65
28.30
0.97
3.54
47.25
7.49
2,008
2,042,853
792,019
1.29
55.41
18.06
1.13
2.14
49.24
4.87
Ten Best Contributors
Integra Lifesciences
Knight Transn Inc
Aptargroup Inc
Blackbaud Inc
Bio Techne Corp
National Instrs Corp
Universal Health Rlt
Graco Inc
Forward Air Corp
Bio Rad Labs Inc
Market Value % of Portfolio Quarterly Ret
235,265
298,697
384,790
420,604
307,028
193,498
159,955
189,382
249,670
227,215
1.88
2.39
3.08
3.36
2.45
1.55
1.28
1.51
2.00
1.82
29.39
18.39
13.27
12.01
15.93
24.25
24.38
16.53
12.34
13.53
Ten Worst Contributors
Manhattan Assocs Inc
Monro Muffler Brake
Hibbett Sports Inc
Dril-Quip Inc
Prosperity Bancshare
Kirby Expl Co.
Caseys Gen Stores
RLI Corp
Pinnacle Finl Partne
Balchem Corp
Market Value % of Portfolio Quarterly Ret
479,399
154,893
69,056
146,986
206,403
286,519
329,577
143,378
185,009
118,741
3.83
1.24
0.55
1.18
1.65
2.29
2.64
1.15
1.48
0.95
-7.67
-19.57
-29.66
-10.54
-7.38
-5.24
-4.38
-8.65
-5.29
-5.71
134
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Atlanta Capital Mgmt
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
1.36
4.64
24.60
15.81
7.65
8.12
17.66
20.16
0.00
0.00
100.00
3.45
5.15
14.26
12.21
2.90
13.05
19.33
17.49
0.69
3.64
100.00
-10.54
8.60
5.63
-2.20
-2.72
15.02
1.71
4.64
3.54
-19.57
0.02
2.29
2.69
-4.19
8.87
0.84
3.81
15.52
2.84
2.06
0.12
0.40
0.82
-0.77
0.11
0.50
0.15
0.17
0.00
0.00
1.50
0.45
0.01
0.02
0.02
-0.30
-0.34
0.02
0.05
-0.09
-0.03
-0.18
0.57
0.41
0.85
-0.75
-0.18
0.16
0.17
0.21
-0.09
-0.03
1.32
Index - Russell 2000
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.02%
[ Actual Return 3.56% ] - [ Buy Hold Return 3.54% ]
135
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Atlanta Capital Mgmt
Quarter Ending 6/17
% Allocation
Energy 1.36 3.45
Materials 4.64 5.15
Industrials 24.60 14.26
Con. Discretionary 15.81 12.21
Consumer Staples 7.65 2.90
Health Care 8.12 13.05
Financials 17.66 19.33
Infomation Tech.20.16 17.49
Telecom. Services 0.00 0.69
Utilities 0.00 3.64
Atlanta Capital Mgmt Russell 2000
% Return
-10.54 -19.57
8.60 0.02
5.63 2.29
-2.20 2.69
-2.72 -4.19
15.02 8.87
1.71 0.84
4.64 3.81
15.52
2.84
% Variance
0.57
0.41
0.85
-0.75
-0.18
0.16
0.17
0.21
-0.09
-0.03
136
City of Clearwater Employees Pension Fund
Systematic Financial Mgt as of 6/30/17
First Merchants Corp
United Cmnty Bks Bla
Kbr Inc
Iberiabank Corp
Carolina Finl Corp N
Adtalem Global Ed In
Cathay Bancorp Inc
Hancock Hldg Co
Skywest Inc
Tivity Health Inc
GICS Sector % Port
Financials
Financials
Industrials
Financials
Financials
Consumer Discretionary
Financials
Financials
Industrials
Health Care
3.28
2.13
2.00
1.83
1.74
1.65
1.61
1.44
1.43
1.40
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
6.22
6.78
15.84
9.02
3.32
7.90
34.45
14.45
0.00
2.01
-5.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
8/31/03
Systematic Financial Mgt R2000V
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
8/31/03
Systematic Financial Mgt
R2000V
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
-0.88
0.67
12,422
31
-109
12,344
-2.56
0.54
12,605
62
-323
12,344
22.85
24.86
13,850
-3,879
2,373
12,344
3.21
7.02
18,589
-6,811
566
12,344
12.22
13.38
11,484
-6,812
7,672
12,344
5.70
5.92
19,609
-12,813
5,548
12,344
8.66
9.14
15,001
-12,813
10,156
12,344
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
137
City of Clearwater Employees Pension Fund
Systematic Financial Mgt as of 6/30/17
Cash & Equiv
$147 1.19%
Domestic Equity
$12,197 98.81%
Periods from 8/03 to 6/17
Alpha
Beta
R-Squared
-0.07
1.05
0.86
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
s1
T
Annualized Standard Deviation%
s Systematic Financial Mgt
1 R2000V
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
8.66
9.14
1.29
20.10
18.39
0.51
0.37
0.43
0.00
-0.02
Asset Allocation ($000)
Risk/Return Analysis
138
City of Clearwater Employees Pension Fund
Small Value Cumulative Performance Comparisons
Total Returns of Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
s Systematic Financial Mgt
Net Ret
Rank
1 R2000V
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
1.57
0.45
0.06
-0.87
-1.59
-0.88
81
0.67
15
28.05
24.09
20.27
19.56
15.69
22.85
37
24.86
21
11.97
11.06
9.49
7.92
7.19
6.55
99
10.29
37
10.15
8.66
8.23
7.53
4.72
3.21
99
7.02
78
14.35
13.15
11.57
11.25
9.50
8.31
99
10.71
79
17.07
15.51
14.39
13.97
12.28
12.22
95
13.38
87
14.26
12.45
12.00
10.65
8.66
9.76
89
10.77
70
17.32
15.65
15.00
14.15
11.84
13.48
78
13.50
78
18.21
16.64
16.03
14.26
13.40
15.51
59
14.88
69
12.22
11.86
11.71
10.46
8.55
8.74
95
9.53
93
5.70
5.92
-5%
0%
5%
10%
15%
20%
25%
30%
s
1
s
1
s
1
s
1
s
1
s1
s1
s1
s1
s1
s1
139
City of Clearwater Employees Pension Fund
Small Value Consecutive Performance Comparisons
Total Returns of Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
s Systematic Financial Mgt
Net Ret
Rank
1 R2000V
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
2.79
2.00
0.68
-1.65
-2.13
-2.56
99
0.54
53
35.83
30.74
27.62
22.14
19.10
28.72
35
31.74
15
0.87
-0.84
-5.13
-11.27
-13.26
-6.39
55
-7.47
59
14.05
9.12
7.44
3.10
0.79
-2.60
99
4.22
67
42.46
40.06
36.97
33.89
28.54
40.72
17
34.50
63
21.66
18.70
16.63
15.32
11.80
23.50
1
18.05
41
2.62
0.57
-1.26
-8.12
-11.18
-9.91
85
-5.50
65
31.41
27.09
25.13
21.15
19.55
35.50
1
24.51
56
55.19
32.60
27.12
24.72
19.53
35.72
15
20.57
92
-22.78
-25.28
-29.56
-31.45
-35.88
-40.71
100
-28.92
48
6.56
3.88
0.40
-7.08
-12.50
0.49
50
-9.77
81
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
s1
s1
s1
s
1
s
1
s
1
s
1
s
1
s
1
s
1
s
1
140
City of Clearwater Employees Pension Fund
June 30, 2017
Performance Comparison
Total Returns of Small Value Portfolios
High
1st Qt
Median
3rd Qt
Low
s Systematic Financial Mgt
Net Ret
Rank
1 R2000V
Net Ret
Rank
Sep 14
Jun 17
Jun 14
Mar 17
Mar 14
Dec 16
Dec 13
Sep 16
Sep 13
Jun 16
10.15
8.66
8.24
7.68
5.95
3.21
100
7.02
85
11.19
9.95
9.13
8.55
6.50
3.40
100
7.62
81
12.62
10.39
10.05
8.15
5.93
5.48
96
8.31
72
11.97
10.11
9.02
7.12
5.69
4.09
100
6.77
78
12.61
10.78
9.71
7.18
6.01
3.86
100
6.35
85
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
s
1
s
1
s
1
s
1
s
1
Systematic Financial Mgt
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
1.4
0.0
-0.3
2.5
1.1 1.2
2.5
-2.6 -2.4
-4.1
2.6
0.1
-0.1
-1.3
-0.2
-3.5
0.6 0.9
-1.6 -1.5
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. R2000V
141
City of Clearwater Employees Pension Fund
Risk Measure Summary
Systematic Financial Mgt
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
2
2
1.00
13.04
0.50
-1.69
15.14
22.85
22.85
16.38
1.15
-1.22
0.99
1.36
19.43
2.80
-0.51
1
3
-0.13
14.07
24.86
24.86
13.63
1.79
5
7
0.82
1.16
0.33
-10.84
15.14
-9.20
28.72
14.71
1.00
-0.90
0.92
0.20
2.96
4.00
-0.90
4
8
-10.73
14.07
-7.72
31.74
14.07
0.48
6
14
0.99
1.16
0.50
-10.84
15.14
-9.20
40.72
13.27
1.04
-0.37
0.91
0.91
11.58
4.06
-0.25
4
16
-10.73
14.07
-7.72
34.50
12.14
1.09
20
35
1.00
1.03
0.53
-27.29
25.37
-40.88
74.73
21.42
1.05
-0.07
0.86
0.36
7.32
7.99
-0.02
16
39
-24.89
22.70
-38.89
65.05
18.92
0.42
142
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Small Value Portfolios
Annualized Rate of Return9.5 10.2 10.9 11.6 12.3 13.0 13.7 14.4 15.1 15.8 16.5
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
s
1MedianRisk Median
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
s Systematic Financial Mgt
1 R2000V
Median
3.21 99 14.71 96
7.02 78 14.07 92
8.23 12.95
Annualized Rate of Return9.0 9.5 10.0 10.5 11.0 11.5 12.0 12.5 13.0 13.5 14.0
10.0
10.9
11.7
12.6
13.5
14.4
15.3
16.2
17.1
18.0
18.9
s
1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
s Systematic Financial Mgt
1 R2000V
Median
12.22 95 13.27 100
13.38 87 12.14 84
14.39 11.60
143
City of Clearwater Employees Pension Fund
Equity Summary Statistics
Systematic Financial Mgt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R2000V
124
12,196,568
2,021,392
1,555,717
1.12
39.82
18.82
1.20
1.44
49.57
0.02
1,397
1,849,571
680,261
1.90
37.73
17.73
1.08
1.44
55.25
1.58
Ten Largest Holdings
First Merchants Corp
United Cmnty Bks Bla
Kbr Inc
Iberiabank Corp
Carolina Finl Corp N
Adtalem Global Ed In
Cathay Bancorp Inc
Hancock Hldg Co
Skywest Inc
Tivity Health Inc
Market Value % of Portfolio Quarterly Ret
399,594
258,957
244,129
223,310
211,534
201,325
196,202
175,175
173,921
170,957
3.28
2.13
2.00
1.83
1.74
1.65
1.61
1.44
1.43
1.40
2.55
0.72
1.81
3.50
7.86
7.05
1.31
8.12
2.72
36.94
Ten Best Performers
At Home Group Inc
Molina Healthcare In
Lantheus Hldgs Inc
Tivity Health Inc
Bankrate Inc Del
Triton Intl Ltd
Hudson Technologies
Craft Brewers Allian
Lhc Group Inc
Cutera Inc
Quarterly Ret
53.63
51.71
41.20
36.94
33.16
31.77
28.03
26.22
25.96
25.12
Ten Worst Performers
Aegean Marine Petrol
Carbo Ceramics Inc
Fairmount Santrol Hl
Whiting Pete Corp Ne
Jones Energy Inc
Independence Contrac
Laredo Pete Hldgs In
Wpx Energy Inc
Precision Drilling C
Resolute Energy Corp
Quarterly Ret
-51.29
-47.47
-46.79
-41.75
-37.25
-29.40
-27.95
-27.86
-27.75
-26.31
144
City of Clearwater Employees Pension Fund
Equity Contribution to Return
Systematic Financial Mgt
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Portfolio R2000V
124
12,196,568
2,021,392
1,555,717
1.12
39.82
18.82
1.20
1.44
49.57
0.02
1,397
1,849,571
680,261
1.90
37.73
17.73
1.08
1.44
55.25
1.58
Ten Best Contributors
At Home Group Inc
Tivity Health Inc
Molina Healthcare In
Hudson Technologies
Lantheus Hldgs Inc
Bankrate Inc Del
Nova Measuring Instr
Nomad Hldgs Ltd
Coresite Rlty Corp
Dupont Fabros Techno
Market Value % of Portfolio Quarterly Ret
120,759
170,957
90,626
130,595
85,514
96,889
154,851
107,377
145,460
90,211
0.99
1.40
0.74
1.07
0.70
0.80
1.27
0.88
1.19
0.74
53.63
36.94
51.71
28.03
41.20
33.16
18.83
23.23
15.95
24.34
Ten Worst Contributors
Precision Drilling C
Aegean Marine Petrol
Central Garden & Pet
Jones Energy Inc
Timkensteel Corp
Wpx Energy Inc
Fairmount Santrol Hl
Whiting Pete Corp Ne
Childrens Pl Retail
Ak Stl Hldg Corp
Market Value % of Portfolio Quarterly Ret
136,281
57,242
141,995
50,386
98,983
65,447
38,513
40,251
102,100
168,192
1.12
0.47
1.17
0.41
0.81
0.54
0.32
0.33
0.84
1.38
-27.75
-51.29
-13.54
-37.25
-18.72
-27.86
-46.79
-41.75
-14.33
-8.62
145
City of Clearwater Employees Pension Fund
Equity Sector Attribution Analysis
Systematic Financial Mgt
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
8.12
8.02
15.99
9.04
2.21
5.78
33.55
15.59
0.00
1.70
100.00
5.51
4.83
12.80
9.78
2.78
4.71
32.19
10.37
0.62
6.31
100.00
-33.36
-3.05
1.07
2.99
3.52
15.67
0.55
5.56
-2.94
-0.53
-19.20
-1.86
4.26
3.43
-7.26
5.97
1.13
-0.15
2.28
2.53
0.34
-1.15
-0.10
-0.51
-0.04
0.24
0.56
-0.19
0.89
0.00
-0.09
-0.39
-0.51
-0.07
0.13
-0.02
0.04
0.06
0.01
-0.03
-0.01
-0.10
-0.50
-1.66
-0.17
-0.38
-0.06
0.28
0.62
-0.18
0.86
-0.01
-0.19
-0.90
Index - R2000V
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.13%
[ Actual Return -0.65% ] - [ Buy Hold Return -0.53% ]
146
City of Clearwater Employees Pension Fund
Equity Sector Attribution Chart
Systematic Financial Mgt
Quarter Ending 6/17
% Allocation
Energy 8.12 5.51
Materials 8.02 4.83
Industrials 15.99 12.80
Con. Discretionary 9.04 9.78
Consumer Staples 2.21 2.78
Health Care 5.78 4.71
Financials 33.55 32.19
Infomation Tech.15.59 10.37
Telecom. Services 0.00 0.62
Utilities 1.70 6.31
Systematic Financial Mgt R2000V
% Return
-33.36 -19.20
-3.05 -1.86
1.07 4.26
2.99 3.43
3.52 -7.26
15.67 5.97
0.55 1.13
5.56 -0.15
2.28
-2.94 2.53
% Variance
-1.66
-0.17
-0.38
-0.06
0.28
0.62
-0.18
0.86
-0.01
-0.19
147
148
City of Clearwater Employees Pension Fund
International EQ Comp as of 6/30/17
Csl Ltd
Reckitt Benckiser Pl
Chubb Limited
Tencent Hldgs Ltd
Nestle S A
Experian Plc
Compass Group Plc
Taiwan Semiconductor
Canadian Pac Railway
Accenture Plc Irelan
GICS Sector % Port
Health Care
Consumer Staples
Financials
Information Technology
Consumer Staples
Industrials
Consumer Discretionary
Information Technology
Industrials
Information Technology
2.57
2.41
2.39
2.27
2.23
2.22
2.04
2.03
2.03
1.90
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.82
6.48
17.28
16.57
10.99
12.34
17.46
11.34
2.54
2.20
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
5/31/01
International EQ Comp MSCI ACWI ex US (Net)
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
5/31/01
International EQ Comp
MSCI ACWI ex US (Net)
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
6.86
5.78
177,667
304
12,189
190,161
16.60
14.10
165,383
-2,476
27,254
190,161
18.40
20.45
111,385
49,936
28,839
190,161
-1.43
1.21
127,635
57,800
4,726
190,161
5.11
8.91
95,335
57,739
37,086
190,161
0.83
1.38
75,007
48,050
67,104
190,161
4.79
5.33
20,000
48,050
122,111
190,161
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
149
City of Clearwater Employees Pension Fund
International EQ Comp as of 6/30/17
Cash & Equiv
$8,227 4.33%
Intl Equity
$181,934 95.67%
Periods from 5/01 to 6/17
Alpha
Beta
R-Squared
-0.13
1.03
0.94
Annualized Return%
0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
I
1
T
Annualized Standard Deviation%
I International EQ Comp
1 MSCI ACWI ex US (N
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
4.79
5.33
1.39
17.33
16.91
0.50
0.20
0.23
0.00
-0.10
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
150
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of International Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
I International EQ Comp
Net Ret
Rank
1 MSCI ACWI ex US (Net)
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
9.68
7.45
6.25
4.79
1.00
6.86
35
5.78
62
30.37
24.18
20.52
17.09
8.70
18.40
67
20.45
51
11.07
7.69
5.33
3.98
1.30
3.53
78
3.98
75
9.02
5.17
3.09
1.37
-0.79
-1.43
96
1.21
77
12.84
9.70
7.56
6.09
3.86
3.70
95
6.50
66
15.22
11.77
9.58
7.59
4.25
5.11
90
8.91
62
11.93
8.08
5.82
4.22
0.84
1.62
92
4.84
69
14.54
11.26
9.00
7.52
4.31
5.46
90
8.22
68
15.33
11.45
9.53
8.07
6.14
6.78
91
7.98
78
10.00
6.53
4.47
3.16
1.60
1.84
93
2.75
81
7.61
5.11
3.40
1.97
0.41
0.83
93
1.38
87
-5%
0%
5%
10%
15%
20%
25%
30%
35%
I1
I
1
I1
I
1
I
1 I
1
I
1 I
1
I1
I1
I1
151
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of International Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
I International EQ Comp
Net Ret
Rank
1 MSCI ACWI ex US (Net)
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
22.08
17.78
14.72
12.56
5.74
16.60
32
14.10
61
17.09
8.22
4.27
0.69
-4.27
2.78
58
4.50
48
10.68
2.29
-1.36
-6.23
-16.58
-9.91
82
-4.29
66
10.58
1.55
-2.50
-4.91
-9.32
-5.56
79
-4.48
70
34.07
25.99
19.74
12.10
-5.02
10.23
76
23.29
34
26.62
21.19
18.55
15.66
6.76
17.61
59
17.90
55
0.67
-8.68
-12.40
-15.59
-22.18
-15.04
71
-11.73
43
26.86
18.67
13.24
9.00
3.29
18.37
25
8.21
78
78.78
45.72
35.69
27.64
12.41
57.93
14
32.46
60
-24.03
-39.35
-43.25
-47.83
-56.00
-47.94
75
-43.06
47
41.45
18.96
12.51
8.17
0.32
11.02
60
11.63
54
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
I1
I1
I
1 I1
I
1
I1
I1
I
1
I
1
I1
I1
152
City of Clearwater Employees Pension Fund
Risk Measure Summary
International EQ Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.05
3.09
0.50
-3.88
9.11
18.40
18.40
11.45
1.22
-1.43
0.94
1.56
14.68
3.76
-0.43
1
3
-1.25
7.86
20.45
20.45
8.28
2.41
5
7
0.83
1.13
0.42
-12.78
9.11
-18.63
18.40
12.37
1.00
-0.64
0.88
-0.13
-1.66
4.20
-0.62
6
6
-12.17
7.86
-10.57
20.45
11.64
0.08
6
14
0.84
1.27
0.40
-12.78
9.11
-18.63
20.73
11.43
0.96
-0.81
0.87
0.43
5.12
4.09
-0.88
7
13
-12.17
11.61
-10.57
24.29
11.02
0.79
22
42
0.99
1.03
0.47
-26.42
31.05
-47.94
71.81
20.28
1.03
-0.12
0.94
0.18
3.55
4.82
-0.10
23
41
-20.50
25.85
-46.20
58.14
19.23
0.22
153
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of International Equity Portfolios
Annualized Rate of Return4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
I
1Median RiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
I International EQ Comp
1 MSCI ACWI ex US (Net)
Median
-1.43 96 12.37 64
1.21 77 11.64 53
3.09 11.58
Annualized Rate of Return5.0 6.2 7.4 8.6 9.8 11.0 12.2 13.4 14.6 15.8 17.0
0.0
1.8
3.6
5.3
7.2
9.0
10.8
12.6
14.4
16.2
18.0
I
1Median RiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
I International EQ Comp
1 MSCI ACWI ex US (Net)
Median
5.11 90 11.43 60
8.91 62 11.02 54
9.58 10.87
154
City of Clearwater Employees Pension Fund
WCM Investment Management as of 6/30/17
Csl Ltd
Reckitt Benckiser Pl
Chubb Limited
Tencent Hldgs Ltd
Nestle S A
Experian Plc
Compass Group Plc
Taiwan Semiconductor
Canadian Pac Railway
Accenture Plc Irelan
GICS Sector % Port
Health Care
Consumer Staples
Financials
Information Technology
Consumer Staples
Industrials
Consumer Discretionary
Information Technology
Industrials
Information Technology
5.14
4.84
4.79
4.56
4.48
4.46
4.08
4.07
4.06
3.82
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.68
5.54
18.49
19.31
11.95
14.80
12.20
15.03
0.00
0.00
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
7/31/15
WCM Investment Management MSCI ACWI ex US (Net)
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
7/31/15
WCM Investment Management
MSCI ACWI ex US (Net)
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
9.34
5.78
70,066
113
6,542
76,721
21.50
14.10
65,638
-2,756
13,838
76,721
17.14
20.45
39,429
26,436
10,855
76,721
8.80
4.31
16,316
48,564
11,841
76,721
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
155
City of Clearwater Employees Pension Fund
WCM Investment Management as of 6/30/17
Cash & Equiv
$4,084 5.32%
Intl Equity
$72,637 94.68%
Periods from 6/15 to 6/17
Alpha
Beta
R-Squared
N/A
N/A
N/A
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
w
1
T
Annualized Standard Deviation%
w WCM Investment Managemen
1 MSCI ACWI ex US (N
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
8.80
4.31
0.36
12.69
13.65
0.08
0.67
0.29
0.00
0.57
Asset Allocation ($000)
Risk/Return Analysis (Number of returns < 12)
156
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of International Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
w WCM Investment Management
Net Ret
Rank
1 MSCI ACWI ex US (Net)
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
9.68
7.45
6.25
4.79
1.00
9.34
6
5.78
62
30.37
24.18
20.52
17.09
8.70
17.14
74
20.45
51
11.07
7.69
5.33
3.98
1.30
8.42
19
3.98
75
0%
5%
10%
15%
20%
25%
30%
35%
w
1
w
1
w
1
157
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of International Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
w WCM Investment Management
Net Ret
Rank
1 MSCI ACWI ex US (Net)
Net Ret
Rank
6/30/17
YTD 2016
22.08
17.78
14.72
12.56
5.74
21.50
6
14.10
61
17.09
8.22
4.27
0.69
-4.27
-1.00
84
4.50
48
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
w
1
w
1
158
City of Clearwater Employees Pension Fund
Global Equity Summary Statistics
WCM Investment Management
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Five Year Dividend Growth
Portfolio MSCI ACWI ex US (Net)
30
72,637,322
71,387,856
33,214,083
1.24
36.37
31.49
0.00
5.15
48.50
9.61
9.11
1,864
57,402,630
7,563,406
2.94
19.93
17.99
1.00
1.68
78.05
8.83
9.29
Ten Largest Holdings
Csl Ltd
Reckitt Benckiser Pl
Chubb Limited
Tencent Hldgs Ltd
Nestle S A
Experian Plc
Compass Group Plc
Taiwan Semiconductor
Canadian Pac Railway
Accenture Plc Irelan
Market Value % of Portfolio Quarterly Ret
3,720,702
3,498,818
3,465,714
3,294,907
3,237,126
3,225,362
2,953,542
2,945,520
2,938,803
2,760,290
5.14
4.84
4.79
4.56
4.48
4.46
4.08
4.07
4.06
3.82
10.88
12.57
7.22
24.86
16.33
2.06
11.84
9.19
9.73
4.25
Ten Best Performers
Tencent Hldgs Ltd
Icon Plc
Yandex N V
Dsv As
Aia Group Ltd
Nestle S A
Hdfc Bank Ltd
Lvmh Moet Hennessy L
Sgs Societe Gen De S
Chr Hansen Hldg A/S
Quarterly Ret
24.86
22.67
19.65
18.35
16.98
16.33
16.28
15.33
13.84
13.22
Ten Worst Performers
Core Laboratories N
Sysmex Corp
Adidas Salomon Ag
Wal Mart De Mexico S
Experian Plc
Accenture Plc Irelan
Hermes Intl Sca
Essilor Intl S A
Luxottica Group S P
Chubb Limited
Quarterly Ret
-11.91
-1.79
1.63
2.05
2.06
4.25
4.83
5.80
7.14
7.22
159
City of Clearwater Employees Pension Fund
Global Performance Attribution Analysis
WCM Investment Management
Quarter Ending 6/17
Countries/
Currencies
Benchmark
Active
Weight
Currency
Weight
Local
Return
US $
Return
Portfolio
Active
Weight
Currency
Weight
Local
Return
US $
Return
Return Attribution
Market
Select
Currency
Select
Security
Select Total
Australia
Austria
Belgium
Bermuda
Brazil
Bulgaria
Canada
Cayman Islands
Channel Islands
Chile
China
Colombia
Czech Republic
Denmark
Egypt
Finland
France
Germany
Greece
Hong Kong
Hungary
India
Indonesia
Ireland
Isle of Man
Israel
Italy
Japan
Jordan
Luxembourg
5.50
0.14
0.81
0.10
1.79
0.05
6.83
0.67
0.26
0.29
4.49
0.10
0.04
1.14
0.03
0.67
6.66
6.62
0.08
2.68
0.07
2.08
0.59
0.36
0.04
0.41
1.37
16.32
0.02
0.13
5.50
0.14
0.81
0.10
1.79
0.05
6.83
0.67
0.26
0.29
4.49
0.10
0.04
1.14
0.03
0.67
6.66
6.62
0.08
2.68
0.07
2.08
0.59
0.36
0.04
0.41
1.37
16.32
0.02
0.13
-2.01
14.63
-1.03
5.20
-2.56
8.75
-1.65
10.87
-7.43
-1.09
8.13
7.72
0.47
8.10
4.33
7.15
3.20
0.12
25.74
7.72
12.21
2.60
8.87
-2.31
17.15
6.11
2.81
6.03
-25.11
0.40
-1.25
22.24
5.54
1.32
-6.63
15.97
1.00
10.39
-3.84
-1.48
7.88
2.04
10.87
15.29
3.93
14.26
10.05
6.75
34.08
7.10
19.55
3.07
8.86
3.91
13.86
7.34
9.63
5.15
-22.20
1.08
5.23
0.00
0.00
0.00
3.04
0.00
3.99
7.23
4.76
0.00
0.00
0.00
0.00
9.09
0.00
0.00
8.41
2.47
0.00
2.49
0.00
3.39
0.00
6.17
0.00
0.00
2.09
1.60
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
10.88
-3.83
9.73
17.90
2.06
12.55
9.16
1.63
16.98
16.28
10.78
7.14
-1.79
10.88
-3.83
9.73
17.90
2.06
12.55
9.16
1.63
16.98
16.28
10.78
7.14
-1.79
0.02
-0.02
0.04
-0.00
-0.08
-0.00
0.15
0.48
-0.50
0.01
-0.20
-0.00
0.00
0.36
-0.00
-0.02
-0.01
0.14
-0.02
-0.01
-0.01
-0.01
-0.03
-0.34
-0.01
-0.01
-0.01
-0.36
0.01
0.00
0.09
-0.01
-0.03
0.01
0.12
-0.00
-0.02
0.02
-0.00
0.01
0.12
0.01
-0.00
-0.05
0.00
-0.03
-0.30
-0.28
-0.00
0.08
-0.00
0.04
0.01
-0.01
0.00
0.00
-0.06
0.54
-0.00
0.00
0.67
-0.04
0.45
0.51
0.45
0.41
0.50
0.04
0.23
0.46
0.81
0.09
-0.13
0.78
-0.02
0.00
0.00
0.00
-0.00
0.59
1.00
-0.05
0.02
-0.08
0.00
-0.00
0.71
0.00
-0.06
0.20
-0.10
-0.02
0.30
-0.01
0.49
-0.02
0.45
-0.00
-0.01
0.02
0.05
0.01
0.01
Benchmark : MSCI ACWI ex US (Net)
160
City of Clearwater Employees Pension Fund
Global Performance Attribution Analysis
WCM Investment Management
Quarter Ending 6/17
Countries/
Currencies
Benchmark
Active
Weight
Currency
Weight
Local
Return
US $
Return
Portfolio
Active
Weight
Currency
Weight
Local
Return
US $
Return
Return Attribution
Market
Select
Currency
Select
Security
Select Total
Malaysia
Mexico
Netherlands
New Zealand
Norway
Papua-New Guinea
Peru
Philippines
Poland
Portugal
Qatar
Russia
Scotland
Singapore
South Africa
South Korea
Spain
Sweden
Switzerland
Taiwan
Thailand
Turkey
United Arab Emirates
United Kingdom
United States
Zambia
0.57
0.89
2.75
0.12
0.44
0.04
0.07
0.27
0.28
0.11
0.19
0.85
0.03
0.95
1.71
3.54
2.35
1.99
6.11
2.88
0.53
0.24
0.18
11.65
0.89
0.04
100.00
0.57
0.89
2.75
0.12
0.44
0.04
0.07
0.27
0.28
0.11
0.19
0.85
0.03
0.95
1.71
3.54
2.35
1.99
6.11
2.88
0.53
0.24
0.18
11.65
0.89
0.04
100.00
1.97
3.15
1.88
3.18
2.29
-5.54
9.72
7.96
6.72
-2.38
-10.39
-4.40
-8.36
3.32
1.09
12.71
1.24
3.29
4.73
9.36
1.41
16.58
1.51
1.27
26.64
-22.34
3.59
5.12
7.16
8.14
8.08
4.89
-5.02
9.72
7.35
14.02
4.10
-10.86
-10.14
-4.80
4.65
2.62
10.17
7.96
9.33
9.47
9.08
2.59
20.52
1.17
5.21
26.64
-20.25
6.01
0.00
2.81
5.61
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
12.03
4.11
0.00
0.00
0.00
8.77
6.69
0.00
100.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
100.00
0.00
100.00
2.05
1.15
12.06
9.19
12.23
8.21
9.52
2.05
1.15
12.06
9.19
12.23
8.21
9.52
0.01
-0.01
-0.05
0.00
0.01
0.00
-0.00
-0.01
-0.01
0.01
0.03
0.07
0.00
0.00
0.04
-0.32
0.06
0.01
0.07
0.07
0.01
-0.03
0.00
0.07
1.34
0.01
0.94
-0.00
-0.01
-0.11
-0.00
-0.00
0.00
0.00
0.01
-0.01
-0.00
0.01
0.07
-0.00
0.01
0.02
0.18
-0.10
-0.07
-0.14
0.08
0.01
-0.00
0.00
-0.18
-2.39
0.00
-2.42
-0.03
-0.04
0.88
-0.01
0.96
-1.23
4.99
0.01
-0.05
-0.20
-0.00
0.00
0.00
-0.00
-0.00
-0.02
0.00
0.03
0.14
0.00
0.01
0.06
-0.15
-0.05
-0.07
0.81
0.14
0.02
-0.03
0.01
0.85
-2.29
0.01
3.51
Benchmark : MSCI ACWI ex US (Net)
Market Selection
[Portfolio Active Weight - Benchmark Active Weight] x [Benchmark Local Return - Benchmark Total Local Return]
Currency Selection
[Portfolio Currency Weight - Benchmark Currency Weight]
x [ (Benchmark US$ Return - Benchmark Local Return) - (Benchmark Total US$ Return - Benchmark Total Local Return) ]
Security Selection
[Portfolio Active Weight] x [Portfolio Local Return - Benchmark Local Return]
161
City of Clearwater Employees Pension Fund
International Equity Sector Attribution Analysis
WCM Investment Management
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
3.29
5.33
14.96
19.29
14.78
14.77
13.22
14.35
0.00
0.00
100.00
6.80
8.02
11.88
11.33
9.87
8.05
23.33
9.92
4.52
3.17
100.00
-11.91
11.83
9.98
9.17
8.27
9.81
10.33
13.81
9.52
-2.60
1.88
7.03
5.86
7.36
7.23
5.98
13.06
4.22
5.37
5.83
-0.31
0.53
0.44
0.64
0.13
0.38
0.58
0.11
0.00
0.00
2.50
0.30
0.11
0.04
0.00
0.08
0.09
-0.01
0.32
0.07
0.01
1.00
-0.01
0.64
0.48
0.64
0.21
0.47
0.56
0.43
0.07
0.01
3.50
Index - MSCI ACWI ex US (Net)
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect 0.34%
[ Actual Return 9.86% ] - [ Buy Hold Return 9.52% ]
162
City of Clearwater Employees Pension Fund
Thompson, Siegel & Walmsley as of 6/30/17
Nestle Sa
Novartis Ag
Koninklijke Philips
Sanofi
Siemens Ag
Hitachi
Orix Corporation
Veolia Environnement
Heineken Holding
Eni Spa
GICS Sector % Port
Consumer Staples
Health Care
Industrials
Health Care
Industrials
Information Technology
Financials
Utilities
Consumer Staples
Energy
2.41
2.27
2.02
1.89
1.87
1.84
1.80
1.80
1.79
1.77
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
2.95
7.41
16.07
13.84
10.03
9.88
22.70
7.67
5.07
4.39
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
7/31/15
Thompson, Siegel & Walmsley MSCI EAFE (Net)
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
7/31/15
Thompson, Siegel & Walmsley
MSCI EAFE (Net)
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
5.92
6.12
72,500
196
4,297
76,993
13.17
13.81
67,730
331
8,932
76,993
20.32
20.26
35,134
29,550
12,309
76,993
2.80
3.01
16,165
51,711
9,117
76,993
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
163
City of Clearwater Employees Pension Fund
Thompson, Siegel & Walmsley as of 6/30/17
Cash & Equiv
$4,143 5.38%
Intl Equity
$72,850 94.62%
Periods from 6/15 to 6/17
Alpha
Beta
R-Squared
N/A
N/A
N/A
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
t1
T
Annualized Standard Deviation%
t Thompson, Siegel & Walms
1 MSCI EAFE (Net)
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
2.80
3.01
0.36
13.74
13.74
0.08
0.18
0.19
0.00
-0.59
Asset Allocation ($000)
Risk/Return Analysis (Number of returns < 12)
164
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of International Equity Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
t Thompson, Siegel & Walmsley
Net Ret
Rank
1 MSCI EAFE (Net)
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
9.68
7.45
6.25
4.79
1.00
5.92
57
6.12
52
30.37
24.18
20.52
17.09
8.70
20.32
52
20.26
52
11.07
7.69
5.33
3.98
1.30
2.68
87
3.94
75
0%
5%
10%
15%
20%
25%
30%
35%
t 1
t 1
t
1
165
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of International Equity Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
t Thompson, Siegel & Walmsley
Net Ret
Rank
1 MSCI EAFE (Net)
Net Ret
Rank
6/30/17
YTD 2016
22.08
17.78
14.72
12.56
5.74
13.17
70
13.81
65
17.09
8.22
4.27
0.69
-4.27
-0.19
80
1.00
73
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
24%
t 1
t
1
166
City of Clearwater Employees Pension Fund
Global Equity Summary Statistics
Thompson, Siegel & Walmsley
Period Ending 6/17
Total Number Of Securities
Equity Market Value
Average Capitalization $(000)
Median Capitalization $(000)
Equity Segment Yield
Equity Segment P/E - Average
Equity Segment P/E - Median
Equity Segment Beta
Price/Book Ratio
Debt/Equity Ratio
Five Year Earnings Growth
Five Year Dividend Growth
Portfolio MSCI EAFE (Net)
94
72,850,113
44,306,688
17,821,316
2.87
18.70
18.51
0.98
1.61
76.54
10.64
7.48
927
55,789,056
10,078,065
3.11
20.81
19.38
1.00
1.65
84.55
8.71
7.84
Ten Largest Holdings
Nestle Sa
Novartis Ag
Koninklijke Philips
Sanofi
Siemens Ag
Hitachi
Orix Corporation
Veolia Environnement
Heineken Holding
Eni Spa
Market Value % of Portfolio Quarterly Ret
1,751,522
1,649,914
1,471,814
1,375,668
1,358,925
1,338,182
1,311,659
1,310,321
1,299,714
1,287,827
2.41
2.27
2.02
1.89
1.87
1.84
1.80
1.80
1.79
1.77
16.95
12.18
12.83
9.00
-0.05
13.48
4.74
17.50
15.98
-6.06
Ten Best Performers
Ryanair Hldgs Plc
Aena Sa
Kuraray Co
Azimut Hldg S.P.A
A.P. Moller - Maersk
Smurfit Kappa Group
Ig Group Hldgs
Cheung Kong Property
Veolia Environnement
Deutsche Boerse Ag
Quarterly Ret
29.68
25.77
20.87
20.84
20.67
20.26
18.65
18.64
17.50
17.38
Ten Worst Performers
Technipfmc Ltd
Coca-Cola Amatil Ltd
Rexel
Coca-Cola Bottlers J
Fujifilm Holdings Co
Astellas Pharma
Imperial Brands Plc
Koninklijke Boskalis
Eni Spa
Fanuc Corporation
Quarterly Ret
-16.31
-14.23
-10.25
-9.61
-7.85
-7.02
-6.71
-6.19
-6.06
-5.89
167
City of Clearwater Employees Pension Fund
Global Performance Attribution Analysis
Thompson, Siegel & Walmsley
Quarter Ending 6/17
Countries/
Currencies
Benchmark
Active
Weight
Currency
Weight
Local
Return
US $
Return
Portfolio
Active
Weight
Currency
Weight
Local
Return
US $
Return
Return Attribution
Market
Select
Currency
Select
Security
Select Total
Australia
Austria
Belgium
Bermuda
Bulgaria
Cayman Islands
Channel Islands
China
Denmark
Finland
France
Germany
Hong Kong
Ireland
Isle of Man
Israel
Italy
Japan
Jordan
Luxembourg
Mexico
Netherlands
New Zealand
Norway
Papua-New Guinea
Portugal
Scotland
Singapore
South Africa
Spain
7.61
0.20
1.16
0.00
0.00
0.00
0.37
0.00
1.64
0.96
10.19
9.50
3.50
0.46
0.03
0.67
2.17
23.37
0.00
0.00
0.00
3.46
0.17
0.63
0.00
0.16
0.04
1.33
0.00
3.36
7.61
0.20
1.16
0.00
0.00
0.00
0.37
0.00
1.64
0.96
10.19
9.50
3.50
0.46
0.03
0.67
2.17
23.37
0.00
0.00
0.00
3.46
0.17
0.63
0.00
0.16
0.04
1.33
0.00
3.36
-2.01
14.63
-1.03
-7.43
8.10
7.15
3.16
0.12
7.66
-2.31
7.84
6.11
2.81
6.03
1.88
3.18
2.29
-2.38
-8.36
3.32
1.24
-1.25
22.24
5.54
-3.84
15.29
14.26
10.00
6.75
7.01
3.91
9.44
7.34
9.63
5.15
8.14
8.08
4.89
4.10
-4.80
4.65
7.96
3.87
0.00
1.04
0.00
0.00
0.97
0.00
0.00
1.52
0.00
8.25
11.95
3.44
2.58
0.00
0.78
5.16
24.07
0.00
0.00
0.52
5.99
0.00
0.00
0.00
0.00
0.00
2.16
0.55
2.13
3.87
0.00
1.04
0.00
0.00
0.00
0.00
0.00
1.52
0.00
8.25
11.95
5.64
0.00
0.00
0.00
5.16
24.07
0.00
0.00
0.00
5.99
0.00
0.00
0.00
0.00
0.00
1.37
0.55
2.13
1.46
2.40
19.18
7.77
3.10
-0.61
3.67
13.98
4.55
0.33
4.74
-5.74
3.72
5.14
4.49
11.50
2.02
9.20
18.64
14.94
9.95
5.99
3.20
16.50
4.55
6.99
3.87
-5.74
10.61
5.32
6.93
18.90
0.19
-0.02
0.00
-0.03
0.04
-0.01
-0.04
-0.00
-0.07
-0.00
-0.11
-0.00
0.00
-0.01
0.02
-0.02
-0.03
-0.00
0.00
0.01
0.00
0.00
-0.02
0.02
0.10
-0.01
-0.00
-0.00
-0.00
-0.04
-0.07
0.08
-0.09
-0.01
0.00
0.01
0.10
-0.03
0.07
-0.00
0.01
-0.00
-0.00
-0.00
-0.02
-0.04
0.13
0.04
0.19
-0.00
-0.00
-0.09
-0.14
0.42
-0.01
-0.13
-0.31
-0.03
0.11
0.04
0.02
0.22
0.42
-0.03
0.04
0.16
0.04
-0.02
-0.08
-0.07
-0.08
-0.23
0.29
-0.00
0.01
-0.03
-0.32
-0.05
0.15
-0.00
0.01
0.00
0.00
0.04
-0.01
0.20
Benchmark : MSCI EAFE (Net)
168
City of Clearwater Employees Pension Fund
Global Performance Attribution Analysis
Thompson, Siegel & Walmsley
Quarter Ending 6/17
Countries/
Currencies
Benchmark
Active
Weight
Currency
Weight
Local
Return
US $
Return
Portfolio
Active
Weight
Currency
Weight
Local
Return
US $
Return
Return Attribution
Market
Select
Currency
Select
Security
Select Total
Sweden
Switzerland
United Kingdom
United States
2.88
8.72
17.85
0.00
100.00
2.88
8.72
17.85
0.00
100.00
3.29
4.73
1.27
3.04
9.33
9.47
5.21
6.46
1.79
5.88
16.27
1.11
100.00
1.79
5.88
16.11
4.69
100.00
9.71
8.14
5.90
-16.31
4.25
16.14
13.03
2.50
-16.31
6.42
-0.00
-0.05
0.03
-0.03
-0.12
-0.03
-0.04
-0.01
-0.16
-0.18
0.12
0.20
0.75
-0.18
1.34
0.08
0.11
0.77
-0.37
1.05
Benchmark : MSCI EAFE (Net)
Market Selection
[Portfolio Active Weight - Benchmark Active Weight] x [Benchmark Local Return - Benchmark Total Local Return]
Currency Selection
[Portfolio Currency Weight - Benchmark Currency Weight]
x [ (Benchmark US$ Return - Benchmark Local Return) - (Benchmark Total US$ Return - Benchmark Total Local Return) ]
Security Selection
[Portfolio Active Weight] x [Portfolio Local Return - Benchmark Local Return]
169
City of Clearwater Employees Pension Fund
International Equity Sector Attribution Analysis
Thompson, Siegel & Walmsley
Quarter Ending 6/17
GICS Sectors
Weight
Portfolio Index
Return
Portfolio Index
Selection
Stock Sector Total
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom. Services
Utilities
2.98
6.38
16.82
14.67
10.80
9.08
22.61
7.67
4.03
4.97
100.00
5.00
7.92
14.31
12.24
11.38
10.70
21.27
5.71
4.36
3.40
100.00
-9.86
9.01
5.96
5.09
6.51
7.20
7.61
5.54
12.44
7.38
6.40
-0.47
3.56
7.26
4.99
7.95
7.31
7.45
9.66
5.03
7.26
6.20
-0.28
0.35
-0.22
0.01
-0.16
-0.01
0.04
-0.32
0.30
0.01
-0.28
0.13
0.04
0.03
-0.03
-0.01
-0.02
0.02
0.07
0.00
0.02
0.25
-0.15
0.39
-0.19
-0.01
-0.17
-0.03
0.05
-0.25
0.30
0.02
-0.03
Index - MSCI EAFE (Net)
Stock Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.13%
[ Actual Return 6.27% ] - [ Buy Hold Return 6.40% ]
170
City of Clearwater Employees Pension Fund
Eaton Vance Mgmt as of 6/30/17
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
22.0
24.0
26.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
4/30/08
Eaton Vance Mgmt MSCI Emg Mkts
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
4/30/08
Eaton Vance Mgmt
MSCI Emg Mkts
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
3.85
6.38
35,097
0
1,350
36,447
14.11
18.60
31,940
0
4,507
36,447
17.69
24.17
36,742
-5,998
5,703
36,447
-1.16
1.44
41,008
-2,998
-1,563
36,447
3.25
4.33
33,734
-2,998
5,711
36,447
0.69
0.97
8,277
4,537
23,632
36,447
Portfolio Performance (%)
171
City of Clearwater Employees Pension Fund
Eaton Vance Mgmt as of 6/30/17
Cash & Equiv
$0 0.00%
Intl Equity
$36,447 100.00%
Periods from 4/08 to 6/17
Alpha
Beta
R-Squared
-0.12
0.97
0.97
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0 24.0
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
v
1
T
Annualized Standard Deviation%
v Eaton Vance Mgmt
1 MSCI Emg Mkts
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
0.69
0.97
0.26
21.64
22.99
0.14
0.02
0.03
0.00
-0.16
Asset Allocation ($000)
Risk/Return Analysis
172
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Emerging Markets Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
v Eaton Vance Mgmt
Net Ret
Rank
1 MSCI Emg Mkts
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
10.37
7.32
6.11
3.65
-0.65
3.85
74
6.38
43
31.78
26.46
23.34
19.58
4.31
17.69
83
24.17
40
10.49
7.73
5.86
4.26
0.66
3.74
82
4.70
69
6.56
3.61
2.27
0.78
-2.52
-1.16
91
1.44
60
10.99
7.00
5.20
4.28
1.98
2.80
92
4.60
65
13.78
7.14
5.30
4.44
3.25
3.25
95
4.33
79
10.33
3.62
2.38
0.92
-0.43
-0.02
88
0.69
82
14.51
7.03
5.86
4.40
2.92
3.54
85
4.22
78
15.61
9.64
8.07
6.84
5.61
5.94
89
6.45
80
10.29
5.58
4.03
2.72
1.00
1.51
93
1.96
88
-5%
0%
5%
10%
15%
20%
25%
30%
35%
v
1
v
1
v1
v
1 v
1 v1
v1
v1
v1
v1
173
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Emerging Markets Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
v Eaton Vance Mgmt
Net Ret
Rank
1 MSCI Emg Mkts
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009
25.16
20.48
18.62
15.07
3.11
14.11
78
18.60
51
23.34
13.97
11.19
6.81
-0.79
12.76
36
11.60
46
2.51
-8.74
-13.85
-16.09
-21.31
-16.09
75
-14.60
57
11.90
2.64
-1.19
-3.79
-8.40
-4.41
80
-1.82
57
27.57
5.19
-0.46
-4.14
-7.49
1.22
40
-2.27
59
29.81
23.28
20.05
16.76
9.63
18.55
64
18.62
63
3.53
-12.69
-17.75
-21.53
-25.62
-19.27
66
-18.17
55
29.89
24.10
20.35
17.57
8.50
23.33
29
19.19
61
92.13
81.23
75.54
68.01
26.55
67.01
75
79.02
32
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
v 1
v 1
v 1
v 1 v 1
v 1
v 1
v 1
v
1
174
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Emerging Markets Portfolios
High
1st Qt
Median
3rd Qt
Low
v Eaton Vance Mgmt
Return
Rank
1 MSCI Emg Mkts
Return
Rank
6/17 3/17 12/16 9/16 6/16
6.56
3.61
2.27
0.78
-2.52
-1.16
91
1.44
60
7.19
4.07
2.49
1.13
-0.86
-0.50
94
1.55
68
5.59
0.24
-1.46
-2.42
-5.00
-3.29
87
-2.19
68
8.89
2.94
0.73
-0.59
-3.39
-1.79
91
-0.21
70
13.95
2.37
0.10
-1.30
-2.99
-1.73
81
-1.21
73
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
14%
16%
v
1
v
1
v
1 v
1
v 1
Eaton Vance Mgmt
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
-1.3
-0.1
1.6 1.6
-0.4
0.7
1.3
-0.7
1.1
-4.2
-2.7
0.0
3.1
-2.1
2.2
0.3
-3.5
2.1
-1.4
-2.4
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. MSCI Emg Mkts
175
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Emerging Markets Portfolios
Annualized Rate of Return6.0 7.8 9.6 11.4 13.2 15.0 16.8 18.6 20.4 22.2 24.0
-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
v
1Median RiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
v Eaton Vance Mgmt
1 MSCI Emg Mkts
Median
-1.16 91 13.79 20
1.44 60 15.44 54
2.27 15.35
Annualized Rate of Return9.0 9.9 10.8 11.7 12.6 13.5 14.4 15.3 16.2 17.1 18.0
-2.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
v
1Median RiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
v Eaton Vance Mgmt
1 MSCI Emg Mkts
Median
3.25 95 12.06 16
4.33 79 13.53 49
5.30 13.56
176
City of Clearwater Employees Pension Fund
Fixed Income Comp as of 6/30/17
United States Treas
United States Treas
United States Treas
United States Treas
United States Treas
United States Treas
FNMA Cl 30 - Tba Aug
United States Treas
United States Treas
United States Treas
Sector % Port
Government
Government
Government
Government
Government
Government
Mortgage
Government
Government
Government
4.30
4.02
3.88
2.39
2.33
2.22
2.19
1.60
1.56
1.55
Finance
Government
Industrials
Mortgage
Transportation
Utilities
Municipals
Foreign
Miscellaneous
% Port
14.68
39.02
11.55
26.52
0.66
3.67
1.34
2.28
0.28
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
12/31/87
Fixed Income Comp BC Agg
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
12/31/87
Fixed Income Comp
BC Agg
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.31
1.45
264,184
-10,638
3,440
256,986
2.31
2.27
249,705
1,387
5,894
256,986
1.57
-0.31
243,359
9,784
3,844
256,986
3.08
2.48
210,470
24,127
22,389
256,986
3.18
2.21
205,650
15,035
36,301
256,986
5.21
4.48
208,746
9,291
38,949
256,986
6.31
6.43
59,224
9,291
188,471
256,986
Holdings and allocations only include SMA accounts.
Portfolio Performance (%)
Top Fixed Income Holdings Sector Allocation
177
City of Clearwater Employees Pension Fund
Fixed Income Comp as of 6/30/17
Domestic Fixed
$272,040 105.86%
Other
$2 0.00%
Domestic Equity
$2 0.00%
Cash & Equiv
$-15,059 -5.86%
Periods from 12/87 to 6/17
Alpha
Beta
R-Squared
0.26
0.62
0.60
Annualized Return%
1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
7.0
F 1
T
Annualized Standard Deviation%
F Fixed Income Comp
1 BC Agg
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
6.31
6.43
3.32
3.13
4.03
1.31
0.95
0.77
0.00
-0.07
Asset Allocation ($000)
Risk/Return Analysis
Holdings and allocations only include SMA accounts.
178
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Fixed Income Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
F Fixed Income Comp
Net Ret
Rank
1 BC Agg
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
4.69
2.07
1.50
0.92
-0.09
1.31
63
1.45
56
12.55
5.07
0.88
-0.07
-1.14
1.57
42
-0.31
82
8.71
5.14
3.30
2.26
0.66
3.64
41
2.79
64
7.01
3.74
2.81
1.98
0.31
3.08
38
2.48
61
7.59
5.00
3.35
2.41
0.70
3.73
39
2.95
62
7.57
4.60
2.72
2.03
0.25
3.18
40
2.21
66
7.75
4.86
3.45
2.60
0.88
3.73
43
3.07
60
8.26
4.99
3.51
2.81
0.86
3.94
39
3.19
60
9.86
5.98
4.40
3.49
0.77
4.90
39
3.96
60
8.71
5.45
4.65
3.72
1.06
5.14
36
4.19
62
8.04
5.68
4.84
4.15
1.23
5.21
39
4.48
63
-2%
0%
2%
4%
6%
8%
10%
12%
14%
F1 F
1
F
1 F
1
F
1 F
1
F
1
F
1
F
1
F
1
F
1
179
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Fixed Income Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
F Fixed Income Comp
Net Ret
Rank
1 BC Agg
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
7.16
4.17
2.62
1.73
0.43
2.31
62
2.27
64
15.28
6.61
3.15
2.13
0.22
5.01
32
2.65
57
3.87
1.24
0.57
-1.30
-5.27
0.30
57
0.55
50
16.69
6.24
4.38
2.05
0.07
6.18
26
5.97
30
9.44
1.46
-0.66
-2.03
-8.11
-0.75
51
-2.02
74
16.90
10.36
6.70
4.09
0.71
6.53
51
4.22
72
16.71
7.86
6.14
3.60
-0.20
5.94
53
7.84
26
16.99
10.46
7.38
5.78
0.89
7.37
50
6.54
63
45.48
17.05
10.27
5.77
-1.26
12.37
41
5.93
73
10.09
5.20
1.70
-6.45
-25.82
2.54
45
5.24
24
10.86
7.62
6.57
5.08
2.35
5.94
62
6.96
41
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
F1 F1 F1
F1
F1
F1 F1 F1
F
1
F1 F1
180
City of Clearwater Employees Pension Fund
Risk Measure Summary
Fixed Income Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.36
0.70
0.75
-2.09
1.39
1.57
1.57
3.33
0.81
0.43
0.92
0.32
1.34
1.06
1.76
1
3
-2.98
1.45
-0.31
-0.31
3.97
-0.20
3
9
1.00
0.68
0.67
-2.09
3.03
0.30
7.15
3.00
0.84
0.24
0.89
0.95
3.41
1.14
0.50
3
9
-2.98
3.03
-0.31
6.00
3.39
0.66
4
16
1.10
0.63
0.80
-2.13
3.03
-0.75
7.15
2.91
0.89
0.29
0.91
1.03
3.37
0.94
1.00
6
14
-2.98
3.03
-2.02
6.00
3.11
0.66
20
98
0.91
0.41
0.53
-2.54
5.72
-0.75
15.87
3.13
0.62
0.26
0.60
0.95
4.85
2.44
-0.07
25
93
-2.98
7.96
-3.23
18.48
4.03
0.77
181
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Fixed Income Portfolios
Annualized Rate of Return0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
F
1Median RiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
F Fixed Income Comp
1 BC Agg
Median
3.08 38 3.00 35
2.48 61 3.39 50
2.81 3.40
Annualized Rate of Return0.0 0.9 1.8 2.7 3.6 4.5 5.4 6.3 7.2 8.1 9.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
F
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
F Fixed Income Comp
1 BC Agg
Median
3.18 40 2.91 33
2.21 66 3.11 38
2.72 3.28
182
City of Clearwater Employees Pension Fund
Dodge & Cox as of 6/30/17
United States Treas
United States Treas
United States Treas
United States Treas
Fhlm Pool C91769
United States Treas
FNMA Pool #al6120
Verizon Communicatio
FNMA Pool Al5667
United States Treas
Sector % Port
Government
Government
Government
Government
Mortgage
Government
Mortgage
Utilities
Mortgage
Government
8.10
2.51
2.43
2.39
1.98
1.72
1.63
1.18
1.08
1.01
Finance
Government
Industrials
Mortgage
Transportation
Utilities
Municipals
Foreign
Miscellaneous
% Port
19.89
21.88
13.37
32.67
1.30
6.37
2.89
1.05
0.59
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
2/29/04
Dodge & Cox BC Agg
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
2/29/04
Dodge & Cox
BC Agg
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.30
1.45
125,724
65
1,632
127,421
2.41
2.27
122,312
2,130
2,979
127,421
2.62
-0.31
134,817
-10,742
3,346
127,421
3.08
2.48
120,544
-5,118
11,995
127,421
3.61
2.21
110,595
-5,127
21,953
127,421
5.41
4.48
97,852
-12,547
42,116
127,421
4.95
4.12
75,656
-12,547
64,312
127,421
Portfolio Performance (%)
Top Fixed Income Holdings Sector Allocation
183
City of Clearwater Employees Pension Fund
Dodge & Cox as of 6/30/17
Cash & Equiv
$2,970 2.33%
Domestic Fixed
$124,451 97.67%
Periods from 2/04 to 6/17
Alpha
Beta
R-Squared
0.35
0.80
0.59
Annualized Return%
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
d
1
T
Annualized Standard Deviation%
d Dodge & Cox
1 BC Agg
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
4.95
4.12
1.29
3.24
3.25
0.52
1.13
0.87
0.00
0.33
Asset Allocation ($000)
Risk/Return Analysis
184
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Fixed Income Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
d Dodge & Cox
Net Ret
Rank
1 BC Agg
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
4.69
2.07
1.50
0.92
-0.09
1.30
63
1.45
56
12.55
5.07
0.88
-0.07
-1.14
2.62
34
-0.31
82
8.71
5.14
3.30
2.26
0.66
3.71
40
2.79
64
7.01
3.74
2.81
1.98
0.31
3.08
38
2.48
61
7.59
5.00
3.35
2.41
0.70
3.93
34
2.95
62
7.57
4.60
2.72
2.03
0.25
3.61
33
2.21
66
7.75
4.86
3.45
2.60
0.88
4.01
37
3.07
60
8.26
4.99
3.51
2.81
0.86
4.27
33
3.19
60
9.86
5.98
4.40
3.49
0.77
5.28
32
3.96
60
8.71
5.45
4.65
3.72
1.06
5.46
24
4.19
62
8.04
5.68
4.84
4.15
1.23
5.41
31
4.48
63
-2%
0%
2%
4%
6%
8%
10%
12%
14%
d1
d
1
d
1 d
1
d
1
d
1
d
1
d
1
d
1
d
1
d
1
185
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Fixed Income Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
d Dodge & Cox
Net Ret
Rank
1 BC Agg
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
7.16
4.17
2.62
1.73
0.43
2.41
56
2.27
64
15.28
6.61
3.15
2.13
0.22
5.55
29
2.65
57
3.87
1.24
0.57
-1.30
-5.27
-0.12
66
0.55
50
16.69
6.24
4.38
2.05
0.07
6.01
29
5.97
30
9.44
1.46
-0.66
-2.03
-8.11
0.65
30
-2.02
74
16.90
10.36
6.70
4.09
0.71
7.85
40
4.22
72
16.71
7.86
6.14
3.60
-0.20
5.10
61
7.84
26
16.99
10.46
7.38
5.78
0.89
7.53
48
6.54
63
45.48
17.05
10.27
5.77
-1.26
14.53
31
5.93
73
10.09
5.20
1.70
-6.45
-25.82
1.37
51
5.24
24
10.86
7.62
6.57
5.08
2.35
5.47
68
6.96
41
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
d1
d
1 d1
d1
d1
d
1 d1 d1
d
1
d
1 d1
186
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Fixed Income Portfolios
High
1st Qt
Median
3rd Qt
Low
d Dodge & Cox
Return
Rank
1 BC Agg
Return
Rank
6/17 3/17 12/16 9/16 6/16
7.01
3.74
2.81
1.98
0.31
3.08
38
2.48
61
6.84
3.89
2.93
2.06
0.30
3.37
36
2.68
58
7.86
4.22
3.18
2.25
0.40
3.78
32
3.03
55
10.20
4.96
4.05
2.64
0.44
4.67
32
4.03
50
9.30
4.66
3.98
2.52
0.53
4.37
33
4.06
46
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
d
1
d
1
d
1
d
1 d 1
Dodge & Cox
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
1.1
0.7 0.8
0.4 0.3
1.2
0.5
0.1 0.1
-0.7
-0.2
0.7
-1.8
0.7
-0.5
0.6
1.2
1.6
0.3
-0.1
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. BC Agg
187
City of Clearwater Employees Pension Fund
Risk Measure Summary
Dodge & Cox
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.51
0.49
0.75
-1.45
1.68
2.62
2.62
2.86
0.67
0.66
0.82
0.75
3.19
1.57
1.86
1
3
-2.98
1.45
-0.31
-0.31
3.97
-0.20
3
9
0.90
0.46
0.58
-1.45
2.78
-0.12
7.19
2.65
0.66
0.33
0.72
1.07
4.29
1.81
0.30
3
9
-2.98
3.03
-0.31
6.00
3.39
0.66
4
16
1.08
0.33
0.75
-1.89
2.78
-0.12
7.19
2.68
0.75
0.47
0.75
1.28
4.57
1.54
0.88
6
14
-2.98
3.03
-2.02
6.00
3.11
0.66
11
42
1.05
0.52
0.60
-2.88
6.98
-0.26
17.78
3.46
0.80
0.35
0.59
1.05
4.56
2.44
0.33
15
38
-2.98
4.57
-2.02
10.56
3.43
0.81
188
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Fixed Income Portfolios
Annualized Rate of Return0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
d
1Median RiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
d Dodge & Cox
1 BC Agg
Median
3.08 38 2.65 31
2.48 61 3.39 50
2.81 3.40
Annualized Rate of Return0.0 0.9 1.8 2.7 3.6 4.5 5.4 6.3 7.2 8.1 9.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
d
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
d Dodge & Cox
1 BC Agg
Median
3.61 33 2.68 29
2.21 66 3.11 38
2.72 3.28
189
City of Clearwater Employees Pension Fund
Fixed Income, Mortgage and Municipals Summary Statistics
Dodge & Cox
Quarter Ending 6/17
Total Number Of Securities
Total Market Value
Yield to Maturity
Time to Maturity
Current Coupon
Duration
Effective Convexity
Effective Duration
Effective Maturity
Portfolio BC Agg
223
124,451,189
2.72
12.50
3.94
5.49
0.41
4.95
8.01
9,355
2.55
8.27
3.06
6.17
0.16
6.01
8.27
Yield to Maturity
5+ 9.7%
4 - 5 11.1%
3 - 4 18.1%
2 - 3 29.9%
1 - 2 25.2%
0 - 1 6.1%
Time to Maturity
10+ 46.0%
7 - 10 13.7%
5 - 7 7.7%
3 - 5 5.2%
1 - 3 13.7%
0 - 1 13.7%
Coupon
11+ 0.0%
9 - 11 0.7%
7 - 9 7.3%
5 - 7 23.3%
3 - 5 36.9%
0 - 3 31.8%
Quality
NR 11.6%
B 1.3%
BA 3.0%
BAA 33.4%
A 4.5%
AA 2.0%
AAA 23.0%
GOVT 21.2%
Duration
8+ 23.1%
6 - 8 11.5%
4 - 6 14.5%
3 - 4 17.4%
1 - 3 19.4%
0 - 1 14.1%
Effective Duration
8+ 22.7%
6 - 8 10.4%
4 - 6 8.6%
3 - 4 7.2%
1 - 3 32.6%
0 - 1 18.6%
190
City of Clearwater Employees Pension Fund
Percent Invested by Sector and Quality
Dodge & Cox
As of 6/30/17
Name
Moody’s Quality Ratings
Aaa Aa A Baa Ba B Other NR Total
Government
Treasury
Agency
Corporate
Industrial
Utility
Finance
Yankee
Transportation
Mortgage
GNMA
FHLMC
FNMA
Other Mortgage
Municipals
Cash
Other
Total
20.30
20.02
0.28
0.27
---
---
0.27
---
---
23.70
---
7.51
15.60
0.59
---
---
---
44.26
---
---
---
1.06
---
---
1.06
---
0.16
---
---
---
---
---
0.78
---
---
1.99
---
---
---
2.75
0.58
---
2.17
---
1.15
---
---
---
---
---
0.56
---
---
4.46
1.58
---
1.58
30.30
10.99
5.32
13.57
0.43
---
---
---
---
---
---
1.55
---
---
33.43
---
---
---
3.04
1.12
1.05
0.87
---
---
---
---
---
---
---
---
---
---
3.04
---
---
---
1.26
0.52
---
0.74
---
---
---
---
---
---
---
---
---
---
1.26
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
2.01
0.16
---
1.23
0.62
---
8.97
0.02
2.93
6.01
---
---
---
0.59
11.57
21.88
20.02
1.86
40.69
13.37
6.37
19.91
1.05
1.31
32.67
0.02
10.44
21.61
0.59
2.89
---
0.59
100.00
191
City of Clearwater Employees Pension Fund
Fixed Income Sector Attribution Analysis
Dodge & Cox
Quarter Ending 6/17
Weight
Portfolio Index
Return
Portfolio Index
Selection
Security Sector Total
Finance
Government
Industrials
Mortgage
Transportation
Utilities
Municipals
Foreign
Miscellaneous
20.42
23.23
14.01
29.80
1.36
6.77
2.70
1.08
0.62
100.00
11.06
39.19
12.66
28.11
0.69
3.48
0.08
4.71
0.01
100.00
2.30
0.17
1.89
0.77
1.25
4.37
4.65
0.89
1.45
1.79
1.19
2.57
1.09
2.91
2.75
1.07
1.55
3.01
1.49
0.11
-0.24
-0.10
-0.10
-0.02
0.11
0.10
-0.01
0.00
-0.15
0.03
0.05
0.01
-0.01
0.01
0.04
-0.01
-0.00
0.01
0.13
0.13
-0.19
-0.08
-0.10
-0.01
0.15
0.09
-0.01
0.01
-0.02
Index - Wilshire GCM Index
Security Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.09%
[ Actual Return 1.37% ] - [ Buy Hold Return 1.45% ]
192
City of Clearwater Employees Pension Fund
Western Asset Management Co. as of 6/30/17
United States Treas
United States Treas
United States Treas
United States Treas
United States Treas
FNMA Cl 30 - Tba Aug
United States Treas
United States Treas
United States Treas
United States Treas
Sector % Port
Government
Government
Government
Government
Government
Mortgage
Government
Government
Government
Government
8.65
7.80
4.81
4.69
4.47
4.41
3.22
3.14
3.13
3.12
Finance
Government
Industrials
Mortgage
Transportation
Utilities
Municipals
Foreign
Miscellaneous
% Port
10.16
53.90
9.98
21.18
0.10
1.33
0.00
3.35
0.00
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
9/30/04
Western Asset Management Co.BC Agg
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
9/30/04
Western Asset Management Co.
BC Agg
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.44
1.45
125,875
84
1,807
127,766
2.37
2.27
120,187
4,666
2,912
127,766
0.33
-0.31
122,399
4,889
477
127,766
2.91
2.48
93,599
23,793
10,374
127,766
2.61
2.21
89,682
23,774
14,310
127,766
4.88
4.48
95,293
23,727
8,746
127,766
4.55
4.19
74,568
23,727
29,471
127,766
Portfolio Performance (%)
Top Fixed Income Holdings Sector Allocation
193
City of Clearwater Employees Pension Fund
Western Asset Management Co. as of 6/30/17
Domestic Fixed
$147,589 115.51%
Other
$2 0.00%
Cash & Equiv
$-19,825 -15.52%
Periods from 9/04 to 6/17
Alpha
Beta
R-Squared
0.04
1.06
0.93
Annualized Return%
0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
w
1
T
Annualized Standard Deviation%
w Western Asset Management
1 BC Agg
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
4.55
4.19
1.30
3.60
3.31
0.91
0.90
0.88
0.00
0.35
Asset Allocation ($000)
Risk/Return Analysis
194
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Fixed Income Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
w Western Asset Management Co.
Net Ret
Rank
1 BC Agg
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
Last 10
Years
4.69
2.07
1.50
0.92
-0.09
1.44
56
1.45
56
12.55
5.07
0.88
-0.07
-1.14
0.33
63
-0.31
82
8.71
5.14
3.30
2.26
0.66
3.31
49
2.79
64
7.01
3.74
2.81
1.98
0.31
2.91
46
2.48
61
7.59
5.00
3.35
2.41
0.70
3.39
49
2.95
62
7.57
4.60
2.72
2.03
0.25
2.61
52
2.21
66
7.75
4.86
3.45
2.60
0.88
3.36
52
3.07
60
8.26
4.99
3.51
2.81
0.86
3.51
50
3.19
60
9.86
5.98
4.40
3.49
0.77
4.37
50
3.96
60
8.71
5.45
4.65
3.72
1.06
4.67
49
4.19
62
8.04
5.68
4.84
4.15
1.23
4.88
48
4.48
63
-2%
0%
2%
4%
6%
8%
10%
12%
14%
w1
w
1
w1 w1
w1 w1
w1 w1
w1
w1
w1
195
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Fixed Income Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
w Western Asset Management Co.
Net Ret
Rank
1 BC Agg
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
7.16
4.17
2.62
1.73
0.43
2.37
60
2.27
64
15.28
6.61
3.15
2.13
0.22
3.66
44
2.65
57
3.87
1.24
0.57
-1.30
-5.27
0.73
43
0.55
50
16.69
6.24
4.38
2.05
0.07
6.65
19
5.97
30
9.44
1.46
-0.66
-2.03
-8.11
-2.46
83
-2.02
74
16.90
10.36
6.70
4.09
0.71
5.07
62
4.22
72
16.71
7.86
6.14
3.60
-0.20
7.23
37
7.84
26
16.99
10.46
7.38
5.78
0.89
7.09
53
6.54
63
45.48
17.05
10.27
5.77
-1.26
9.24
54
5.93
73
10.09
5.20
1.70
-6.45
-25.82
3.92
37
5.24
24
10.86
7.62
6.57
5.08
2.35
6.51
51
6.96
41
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
w1 w1 w1
w1
w1
w1
w1 w1 w
1 w1 w1
196
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Fixed Income Portfolios
High
1st Qt
Median
3rd Qt
Low
w Western Asset Management Co.
Return
Rank
1 BC Agg
Return
Rank
6/17 3/17 12/16 9/16 6/16
7.01
3.74
2.81
1.98
0.31
2.91
46
2.48
61
6.84
3.89
2.93
2.06
0.30
3.21
41
2.68
58
7.86
4.22
3.18
2.25
0.40
3.65
37
3.03
55
10.20
4.96
4.05
2.64
0.44
4.61
34
4.03
50
9.30
4.66
3.98
2.52
0.53
4.43
31
4.06
46
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
w
1
w
1
w
1
w
1 w 1
Western Asset Management Co.
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-0.6%
-0.4%
-0.2%
-0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
1.6%
1.8%
2.0%
2.2%
0.4
0.1
-0.1 -0.1
-0.2
0.0
0.4
0.3
0.1
-0.1
0.3
-0.1
-0.4
0.3 0.3
0.1
0.5
0.1 0.1
0.0
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. BC Agg
197
City of Clearwater Employees Pension Fund
Risk Measure Summary
Western Asset Management Co.
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.21
0.97
0.75
-2.90
1.44
0.33
0.33
4.02
1.01
0.16
0.99
-0.04
-0.15
0.43
1.50
1
3
-2.98
1.45
-0.31
-0.31
3.97
-0.20
3
9
1.08
0.94
0.67
-2.90
3.36
0.33
6.48
3.47
1.01
0.10
0.98
0.77
2.64
0.49
0.86
3
9
-2.98
3.03
-0.31
6.00
3.39
0.66
6
14
1.11
1.00
0.60
-2.90
3.36
-2.46
6.65
3.29
1.05
0.07
0.98
0.74
2.33
0.47
0.84
6
14
-2.98
3.03
-2.02
6.00
3.11
0.66
15
36
1.09
1.09
0.61
-2.90
5.22
-2.46
14.60
3.60
1.06
0.04
0.93
0.90
3.06
0.98
0.35
14
37
-2.98
4.57
-2.02
10.56
3.31
0.88
198
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Fixed Income Portfolios
Annualized Rate of Return0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
w1Median RiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
w Western Asset Management Co.
1 BC Agg
Median
2.91 46 3.47 58
2.48 61 3.39 50
2.81 3.40
Annualized Rate of Return0.0 0.9 1.8 2.7 3.6 4.5 5.4 6.3 7.2 8.1 9.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
w1Median RiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
w Western Asset Management Co.
1 BC Agg
Median
2.61 52 3.29 52
2.21 66 3.11 38
2.72 3.28
199
City of Clearwater Employees Pension Fund
Fixed Income, Mortgage and Municipals Summary Statistics
Western Asset Management Co.
Quarter Ending 6/17
Total Number Of Securities
Total Market Value
Yield to Maturity
Time to Maturity
Current Coupon
Duration
Effective Convexity
Effective Duration
Effective Maturity
Portfolio BC Agg
453
147,588,594
2.30
11.42
2.67
6.04
0.47
5.40
8.07
9,355
2.55
8.27
3.06
6.17
0.16
6.01
8.27
Yield to Maturity
5+ 2.1%
4 - 5 5.6%
3 - 4 17.7%
2 - 3 36.2%
1 - 2 36.8%
0 - 1 1.7%
Time to Maturity
10+ 36.0%
7 - 10 8.2%
5 - 7 16.7%
3 - 5 8.3%
1 - 3 13.7%
0 - 1 17.1%
Coupon
11+ 0.0%
9 - 11 0.0%
7 - 9 1.1%
5 - 7 10.1%
3 - 5 34.7%
0 - 3 54.1%
Quality
NR 1.8%
B 0.5%
BA 0.9%
BAA 12.2%
A 8.9%
AA 2.2%
AAA 22.4%
GOVT 51.1%
Duration
8+ 20.3%
6 - 8 9.5%
4 - 6 27.6%
3 - 4 12.0%
1 - 3 13.9%
0 - 1 16.7%
Effective Duration
8+ 18.8%
6 - 8 7.1%
4 - 6 25.7%
3 - 4 12.7%
1 - 3 17.3%
0 - 1 18.4%
200
City of Clearwater Employees Pension Fund
Percent Invested by Sector and Quality
Western Asset Management Co.
As of 6/30/17
Name
Moody’s Quality Ratings
Aaa Aa A Baa Ba B Other NR Total
Government
Treasury
Agency
Corporate
Industrial
Utility
Finance
Yankee
Transportation
Mortgage
GNMA
FHLMC
FNMA
Other Mortgage
Municipals
Cash
Other
Total
52.67
50.44
2.24
1.13
0.68
---
0.25
0.21
---
19.74
2.90
2.93
12.89
1.03
---
---
---
73.55
1.08
---
1.08
1.09
0.71
---
0.25
0.13
---
---
---
---
---
---
---
---
---
2.17
---
---
---
8.84
3.55
0.14
3.96
1.20
0.06
---
---
---
---
---
---
---
---
8.91
0.15
---
0.15
11.98
4.04
1.19
5.15
1.61
0.04
---
---
---
---
---
---
---
---
12.17
---
---
---
0.87
0.70
---
0.17
---
---
---
---
---
---
---
---
---
---
0.87
---
---
---
0.54
0.31
---
0.24
---
---
---
---
---
---
---
---
---
---
0.54
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
---
0.36
---
---
0.15
0.21
---
1.44
0.12
0.08
1.24
---
---
---
---
1.79
53.90
50.44
3.47
24.81
9.99
1.33
10.17
3.36
0.10
21.18
3.02
3.01
14.13
1.03
---
---
---
100.00
201
City of Clearwater Employees Pension Fund
Fixed Income Sector Attribution Analysis
Western Asset Management Co.
Quarter Ending 6/17
Weight
Portfolio Index
Return
Portfolio Index
Selection
Security Sector Total
Finance
Government
Industrials
Mortgage
Transportation
Utilities
Municipals
Foreign
Miscellaneous
10.61
52.46
10.27
22.10
0.10
1.39
0.00
3.07
0.00
100.00
11.06
39.19
12.66
28.11
0.69
3.48
0.08
4.71
0.01
100.00
2.58
0.74
2.50
1.22
1.18
2.39
0.00
2.58
1.30
1.79
1.19
2.57
1.09
2.91
2.75
1.07
1.55
3.01
1.49
0.08
-0.24
-0.01
0.03
-0.00
-0.00
-0.00
0.03
0.00
-0.11
-0.00
-0.04
-0.03
0.02
-0.01
-0.03
0.00
-0.00
-0.00
-0.08
0.08
-0.28
-0.03
0.05
-0.01
-0.03
0.00
0.03
-0.00
-0.19
Index - Wilshire GCM Index
Security Selection Return Attribution
[ Portfolio Market Value Sector Percentage ] * [ Portfolio Sector Return - Index Sector Return ]
Sector Selection Return Attribution
[ Portfolio Sector Percentage - Index Sector Percentage ] * [ Index Sector Return - Index Total Return ]
Trading Effect -0.02%
[ Actual Return 1.28% ] - [ Buy Hold Return 1.30% ]
202
City of Clearwater Employees Pension Fund
Real Estate Comp as of 6/30/17
Simon Ppty Group Inc
Prologis Inc
Avalonbay Cmntys Inc
Hcp Inc
Equity Residential P
Equinix Inc
Macerich Co
Welltower Inc
Public Storage Inc
Weingarten Realty In
GICS Sector % Port
Financials
Financials
Financials
Financials
Financials
Telecom Services
Financials
Financials
Financials
Financials
7.71
6.45
5.09
4.70
4.38
4.30
4.07
3.75
3.74
3.33
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
4/30/08
Real Estate Comp Policy Index
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
4/30/08
Real Estate Comp
Policy Index
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
0.81
1.84
124,369
-8
1,005
125,367
1.68
2.78
123,042
-392
2,717
125,367
3.15
1.72
123,565
-2,732
4,533
125,367
7.92
9.81
90,742
8,763
25,862
125,367
8.65
10.53
76,203
7,867
41,296
125,367
5.72
6.98
19,347
6,936
99,084
125,367
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
203
City of Clearwater Employees Pension Fund
Real Estate Comp as of 6/30/17
Cash & Equiv
$505 0.40%
Real Estate
$87,803 70.04%
Domestic Equity
$37,059 29.56%
Periods from 4/08 to 6/17
Alpha
Beta
R-Squared
-0.25
0.98
0.99
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0 24.0 26.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
R
1
T
Annualized Standard Deviation%
R Real Estate Comp
1 Policy Index
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
5.72
6.98
0.26
24.24
24.86
0.14
0.23
0.27
0.00
-0.43
Asset Allocation ($000)
Risk/Return Analysis
204
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
R Real Estate Comp
Net Ret
Rank
1 Policy Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
7.51
2.91
1.72
0.76
-6.74
0.81
73
1.84
47
23.99
8.77
4.99
-1.23
-13.60
3.15
56
1.72
58
20.96
11.00
9.51
4.68
-9.99
7.70
64
10.30
33
22.32
11.83
9.43
4.77
-7.28
7.92
65
9.81
45
24.43
12.61
10.41
6.62
-6.08
9.01
64
10.74
47
23.64
12.45
10.07
7.91
-4.01
8.65
69
10.53
44
20.48
12.89
10.42
6.97
-4.11
8.82
67
10.98
41
22.46
13.85
12.51
8.80
-4.78
11.84
53
13.59
27
18.97
12.64
10.05
4.71
-3.65
16.82
16
18.19
8
12.70
6.08
4.37
0.84
-11.42
7.26
20
8.42
14
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
R1 R1
R
1
R
1 R
1
R
1
R
1 R
1
R1
R1
205
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
R Real Estate Comp
Net Ret
Rank
1 Policy Index
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009
14.27
5.25
3.52
1.55
-6.88
1.68
73
2.78
56
22.91
10.16
8.05
3.60
-14.98
6.35
63
8.06
49
32.72
15.91
11.17
2.44
-21.27
6.35
60
8.33
55
37.91
21.11
13.34
8.77
-10.78
21.77
24
25.22
22
32.06
14.95
10.40
2.97
-6.80
6.29
62
6.02
63
32.05
17.62
11.44
5.63
-7.03
11.69
48
15.41
32
34.44
17.10
11.39
2.47
-15.86
8.85
59
11.62
49
30.94
18.57
13.85
1.00
-26.38
30.51
5
24.96
13
38.62
-0.46
-27.53
-34.25
-61.97
24.68
15
29.20
12
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
R 1 R 1 R 1
R 1
R 1
R 1
R 1
R
1 R
1
206
City of Clearwater Employees Pension Fund
Risk Measure Summary
Real Estate Comp
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.60
-1.41
0.50
0.54
0.90
3.15
3.15
0.33
0.08
0.63
0.05
8.14
32.34
2.21
0.62
2
2
-0.77
1.84
1.72
1.72
2.35
0.52
2
10
0.71
0.43
0.33
-4.20
9.53
3.15
12.44
6.48
0.76
0.11
0.95
1.19
10.18
2.58
-0.74
4
8
-5.18
11.15
1.72
19.60
8.37
1.15
3
17
0.76
0.44
0.35
-4.20
9.53
3.15
21.77
5.77
0.76
0.15
0.95
1.47
11.17
2.26
-0.82
5
15
-5.18
11.15
1.72
25.22
7.42
1.40
7
29
0.90
0.96
0.39
-37.93
33.98
-45.85
118.01
25.70
0.98
-0.25
0.99
0.27
7.13
2.78
-0.43
9
27
-40.40
35.93
-45.65
115.40
25.96
0.31
207
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Real Estate Portfolios
Annualized Rate of Return0.0 1.8 3.6 5.4 7.2 9.0 10.8 12.6 14.4 16.2 18.0
-4.0
-1.4
1.1
3.7
6.3
9.0
11.6
14.2
16.8
19.4
22.0
R
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
3 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
R Real Estate Comp
1 Policy Index
Median
7.92 65 6.48 37
9.81 45 8.37 44
9.43 9.16
Annualized Rate of Return0.0 4.0 8.0 12.0 16.0 20.0 24.0 28.0
-4.0
-1.2
1.5
4.3
7.2
10.0
12.8
15.6
18.4
21.1
23.9
R
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
R Real Estate Comp
1 Policy Index
Median
8.65 69 5.77 34
10.53 44 7.42 42
10.07 8.52
208
City of Clearwater Employees Pension Fund
Security Capital as of 6/30/17
Simon Ppty Group Inc
Prologis Inc
Avalonbay Cmntys Inc
Hcp Inc
Equity Residential P
Equinix Inc
Macerich Co
Welltower Inc
Public Storage Inc
Weingarten Realty In
GICS Sector % Port
Financials
Financials
Financials
Financials
Financials
Telecom Services
Financials
Financials
Financials
Financials
7.71
6.45
5.09
4.70
4.38
4.30
4.07
3.75
3.74
3.33
Energy
Materials
Industrials
Consumer Discretionary
Consumer Staples
Health Care
Financials
Information Technology
Telecom Services
Utilities
% Port
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
4/30/08
Security Capital Wilshire RESI
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
4/30/08
Security Capital
Wilshire RESI
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
0.79
1.91
37,232
60
295
37,587
0.74
2.42
37,311
0
276
37,587
-2.52
-1.23
42,215
-3,622
-1,007
37,587
7.83
8.82
44,332
-16,655
9,910
37,587
8.93
9.70
43,851
-25,302
19,038
37,587
6.21
6.84
19,347
-54,111
72,352
37,587
Portfolio Performance (%)
Top Equity Holdings GICS Sector Allocation
209
City of Clearwater Employees Pension Fund
Security Capital as of 6/30/17
Cash & Equiv
$528 1.40%
Domestic Equity
$37,059 98.60%
Periods from 4/08 to 6/17
Alpha
Beta
R-Squared
-0.13
1.00
0.99
Annualized Return%
-2.0 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 22.0 24.0 26.0 28.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
s
1
T
Annualized Standard Deviation%
s Security Capital
1 Wilshire RESI
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
6.21
6.84
0.26
26.61
26.77
0.14
0.22
0.25
0.00
-0.27
Asset Allocation ($000)
Risk/Return Analysis
210
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
s Security Capital
Net Ret
Rank
1 Wilshire RESI
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
Last 7
Years
Last 8
Years
Last 9
Years
7.51
2.91
1.72
0.76
-6.74
0.79
74
1.91
45
23.99
8.77
4.99
-1.23
-13.60
-2.52
87
-1.23
75
20.96
11.00
9.51
4.68
-9.99
8.79
58
10.47
31
22.32
11.83
9.43
4.77
-7.28
7.83
65
8.82
54
24.43
12.61
10.41
6.62
-6.08
9.20
62
10.03
53
23.64
12.45
10.07
7.91
-4.01
8.93
67
9.70
55
20.48
12.89
10.42
6.97
-4.11
9.26
64
10.17
53
22.46
13.85
12.51
8.80
-4.78
12.53
49
13.50
28
18.97
12.64
10.05
4.71
-3.65
17.45
13
18.11
9
12.70
6.08
4.37
0.84
-11.42
7.77
18
8.35
14
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
s1
s1
s
1
s1 s1 s1 s1
s1
s1
s1
211
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
s Security Capital
Net Ret
Rank
1 Wilshire RESI
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011 2010 2009
14.27
5.25
3.52
1.55
-6.88
0.74
80
2.42
66
22.91
10.16
8.05
3.60
-14.98
5.71
67
7.62
54
32.72
15.91
11.17
2.44
-21.27
4.70
67
4.81
66
37.91
21.11
13.34
8.77
-10.78
33.13
8
31.53
11
32.06
14.95
10.40
2.97
-6.80
1.60
85
2.15
81
32.05
17.62
11.44
5.63
-7.03
16.22
29
17.55
25
34.44
17.10
11.39
2.47
-15.86
6.86
65
8.56
61
30.94
18.57
13.85
1.00
-26.38
31.62
4
29.12
7
38.62
-0.46
-27.53
-34.25
-61.97
24.68
15
29.20
12
-70%
-60%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
s 1 s 1 s 1
s 1
s 1
s 1
s 1
s 1
s
1
212
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Real Estate Portfolios
Annualized Rate of Return0.0 4.0 8.0 12.0 16.0 20.0 24.0 28.0
-4.0
-1.2
1.5
4.3
7.2
10.0
12.8
15.6
18.4
21.1
23.9
s1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
s Security Capital
1 Wilshire RESI
Median
8.93 67 11.42 76
9.70 55 11.15 70
10.07 8.52
Annualized Rate of Return0.0 4.0 8.0 12.0 16.0 20.0 24.0 28.0
-4.0
-1.2
1.5
4.3
7.2
10.0
12.8
15.6
18.4
21.1
23.9
s1MedianRisk Median
Return
Historical Standard Deviation of Return
5 Years Ending 6/30/17
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
s Security Capital
1 Wilshire RESI
Median
8.93 67 11.42 76
9.70 55 11.15 70
10.07 8.52
213
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
High
1st Qt
Median
3rd Qt
Low
s Security Capital
Net Ret
Rank
1 Wilshire RESI
Net Ret
Rank
6/17 3/17 12/16 9/16 6/16
22.32
11.83
9.43
4.77
-7.28
7.83
65
8.82
54
22.48
12.72
10.47
5.78
-13.60
10.02
55
10.68
48
23.19
13.89
11.73
5.99
-11.99
13.79
25
14.05
23
25.42
14.28
12.01
7.37
-9.40
14.37
24
14.61
23
30.13
14.72
12.67
8.00
-8.49
13.41
40
14.07
28
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
s 1 s 1
s 1 s 1 s 1
Security Capital
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-4.0%
-3.5%
-3.0%
-2.5%
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1.0%
-0.3
-0.4
-0.7
0.8
-0.4
-0.3
0.6
-0.2
0.2
0.7
0.1
-0.6
0.2 0.2
-1.3
-0.9
0.7
-0.3
-0.6
-1.1
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. Wilshire RESI
214
City of Clearwater Employees Pension Fund
Risk Measure Summary
Security Capital
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
3
1
0.31
0.91
0.25
-2.51
0.79
-2.52
-2.52
2.80
0.72
-0.45
0.84
-1.07
-4.19
1.48
-0.89
2
2
-2.20
1.91
-1.23
-1.23
3.71
-0.46
5
7
0.93
1.00
0.50
-10.12
15.81
-2.52
21.41
12.81
1.02
-0.27
0.99
0.59
7.44
1.36
-0.66
4
8
-9.61
15.03
-1.23
23.55
12.46
0.69
9
11
0.95
1.01
0.40
-10.12
15.81
-2.52
33.13
11.42
1.02
-0.22
0.99
0.77
8.61
1.23
-0.57
8
12
-9.61
15.03
-1.23
31.53
11.15
0.85
13
23
0.97
0.99
0.36
-37.93
33.98
-45.85
118.01
27.45
1.00
-0.13
0.99
0.27
7.55
2.13
-0.27
12
24
-40.40
35.93
-45.65
115.40
27.45
0.30
215
City of Clearwater Employees Pension Fund
USAA as of 6/30/17
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
6/30/15
USAA NCREIF ODCE Fund Index
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
6/30/15
USAA
NCREIF ODCE Fund Index
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
-0.55
1.70
10,957
0
-61
10,896
1.65
3.50
10,850
-130
177
10,896
9.57
7.87
10,321
-388
963
10,896
9.10
9.82
5,000
4,304
1,592
10,896
Portfolio Performance (%)
216
City of Clearwater Employees Pension Fund
USAA as of 6/30/17
Cash & Equiv
$-23 -0.21%
Real Estate
$10,919 100.21%
Periods from 6/15 to 6/17
Alpha
Beta
R-Squared
N/A
N/A
N/A
Annualized Return%
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
u1
T
Annualized Standard Deviation%
u USAA
1 NCREIF ODCE Fund I
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
9.10
9.82
0.34
3.80
1.46
0.11
2.30
6.51
0.00
-0.18
Asset Allocation ($000)
Risk/Return Analysis (Number of returns < 12)
217
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
u USAA
Net Ret
Rank
1 NCREIF ODCE Fund Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
7.51
2.91
1.72
0.76
-6.74
-0.55
84
1.70
50
23.99
8.77
4.99
-1.23
-13.60
9.57
22
7.87
33
20.96
11.00
9.51
4.68
-9.99
9.10
55
9.82
45
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
u
1
u
1 u 1
218
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
u USAA
Net Ret
Rank
1 NCREIF ODCE Fund Index
Net Ret
Rank
6/30/17
YTD 2016
14.27
5.25
3.52
1.55
-6.88
1.65
74
3.50
51
22.91
10.16
8.05
3.60
-14.98
12.34
17
8.76
39
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
u
1
u
1
219
City of Clearwater Employees Pension Fund
Risk Measure Summary
USAA
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
1
3
1.22
0.75
-0.55
5.59
9.57
9.57
5.04
1.64
-0.73
0.37
1.80
5.53
4.72
0.34
0
4
1.70
2.11
7.87
7.87
0.42
17.79
1
7
0.93
0.50
-0.55
5.59
7.78
14.21
3.80
0.68
0.57
0.14
2.30
12.81
3.93
-0.18
0
8
1.70
3.68
7.87
11.81
1.46
6.51
220
City of Clearwater Employees Pension Fund
Multi Employer Property Trust as of 6/30/17
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
9/30/10
Multi Employer Property Trust NCREIF ODCE
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
9/30/10
Multi Employer Property Trust
NCREIF ODCE
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.43
1.70
44,629
0
639
45,267
2.73
3.50
44,062
0
1,205
45,267
6.16
7.87
42,639
0
2,629
45,267
9.82
11.34
34,175
0
11,092
45,267
9.50
11.78
24,545
5,000
15,722
45,267
10.25
12.71
0
25,000
20,267
45,267
Portfolio Performance (%)
221
City of Clearwater Employees Pension Fund
Multi Employer Property Trust as of 6/30/17
Cash & Equiv
$0 0.00%
Real Estate
$45,267 100.00%
Periods from 9/10 to 6/17
Alpha
Beta
R-Squared
-0.22
0.89
0.68
Annualized Return%
0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 2.2
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
M
1
T
Annualized Standard Deviation%
M Multi Employer Property
1 NCREIF ODCE
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
10.25
12.71
0.16
1.97
1.65
0.09
5.12
7.59
0.00
-1.78
Asset Allocation ($000)
Risk/Return Analysis
222
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
M Multi Employer Property Trust
Net Ret
Rank
O NCREIF ODCE Fund Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
Last 4
Years
Last 5
Years
Last 6
Years
7.51
2.91
1.72
0.76
-6.74
1.43
63
1.70
50
23.99
8.77
4.99
-1.23
-13.60
6.16
44
7.87
33
20.96
11.00
9.51
4.68
-9.99
8.45
60
9.82
45
22.32
11.83
9.43
4.77
-7.28
9.82
45
11.34
28
24.43
12.61
10.41
6.62
-6.08
10.48
49
11.69
34
23.64
12.45
10.07
7.91
-4.01
9.50
57
11.78
33
20.48
12.89
10.42
6.97
-4.11
9.55
62
11.89
33
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
M O
M
O M O M O M O
M
O
M
O
223
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
M Multi Employer Property Trust
Net Ret
Rank
O NCREIF ODCE Fund Index
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012 2011
14.27
5.25
3.52
1.55
-6.88
2.73
58
3.50
51
22.91
10.16
8.05
3.60
-14.98
8.02
50
8.76
39
32.72
15.91
11.17
2.44
-21.27
12.00
47
15.01
32
37.91
21.11
13.34
8.77
-10.78
12.21
57
12.49
56
32.06
14.95
10.40
2.97
-6.80
11.83
42
13.94
30
32.05
17.62
11.44
5.63
-7.03
4.70
78
10.94
54
34.44
17.10
11.39
2.47
-15.86
12.99
44
15.99
27
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
M O
M O
M
O
M O M O
M
O M
O
224
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
High
1st Qt
Median
3rd Qt
Low
M Multi Employer Property Trust
Net Ret
Rank
1 NCREIF ODCE
Net Ret
Rank
6/17 3/17 12/16 9/16 6/16
22.32
11.83
9.43
4.77
-7.28
9.82
45
11.34
28
22.48
12.72
10.47
5.78
-13.60
10.15
54
11.78
33
23.19
13.89
11.73
5.99
-11.99
10.72
61
12.06
46
25.42
14.28
12.01
7.37
-9.40
11.36
58
12.45
46
30.13
14.72
12.67
8.00
-8.49
11.95
56
12.99
45
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
M 1 M 1 M 1 M 1 M 1
Multi Employer Property Trust
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-10.0%
-9.0%
-8.0%
-7.0%
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
-1.7
-2.4
-0.7
-1.2
0.0 0.0
0.3
-0.6
0.1
-0.1
-0.5
-1.1
-0.5 -0.6
0.6
-0.4 -0.2
-0.7 -0.5 -0.3
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. NCREIF ODCE
225
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Real Estate Portfolios
3 Years Ending 6/30/17
Annualized Rate of Return0.0 1.8 3.6 5.4 7.2 9.0 10.8 12.6 14.4 16.2 18.0
-4.0
-1.4
1.1
3.7
6.3
9.0
11.6
14.2
16.8
19.4
22.0
M
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
M Multi Employer Property Trust
1 NCREIF ODCE
Median
9.82 45 1.52 3
11.34 28 1.58 5
9.43 9.16
226
City of Clearwater Employees Pension Fund
Risk Measure Summary
Multi Employer Property Trust
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.78
0.00
1.29
1.91
6.16
6.16
0.55
0.77
0.01
0.93
10.36
7.38
0.48
-3.36
0
4
1.70
2.11
7.87
7.87
0.42
17.79
0
12
0.87
0.17
1.29
3.31
6.16
12.62
1.52
0.85
0.04
0.86
6.29
11.26
0.84
-1.66
0
12
1.70
3.82
7.87
15.01
1.58
7.01
1
19
0.81
0.15
-0.12
3.53
5.69
12.79
1.87
0.87
-0.15
0.59
4.99
10.77
1.40
-1.50
0
20
1.70
3.86
7.87
15.01
1.38
8.38
1
26
0.81
0.11
-0.12
4.72
4.70
15.44
1.97
0.89
-0.22
0.68
5.12
11.40
1.26
-1.78
0
27
1.70
4.99
7.87
18.27
1.65
7.59
227
City of Clearwater Employees Pension Fund
Molpus Woodlands Group as of 6/30/17
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
6/30/11
Molpus Woodlands Group NCREIF Timberland Index
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
6/30/11
Molpus Woodlands Group
NCREIF Timberland Index
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
0.00
0.70
11,915
0
0
11,915
0.32
1.47
11,655
-99
360
11,915
1.01
3.35
9,979
1,509
428
11,915
3.06
5.54
7,593
3,244
1,078
11,915
5.29
7.16
6,544
3,187
2,184
11,915
4.41
6.13
111
9,691
2,113
11,915
Portfolio Performance (%)
228
City of Clearwater Employees Pension Fund
Molpus Woodlands Group as of 6/30/17
Real Estate
$11,915 100.00%
Periods from 6/11 to 6/17
Alpha
Beta
R-Squared
0.17
0.53
0.18
Annualized Return%
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
M
1
T
Annualized Standard Deviation%
M Molpus Woodlands Group
1 NCREIF Timberland Index
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
4.41
6.13
0.15
4.81
4.33
0.06
0.89
1.38
0.00
-0.49
Asset Allocation ($000)
Risk/Return Analysis
229
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
M Molpus Woodlands Group
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
7.51
2.91
1.72
0.76
-6.74
0.00
81
0.70
76
23.99
8.77
4.99
-1.23
-13.60
1.01
63
3.35
56
20.96
11.00
9.51
4.68
-9.99
1.47
82
3.37
79
22.32
11.83
9.43
4.77
-7.28
3.06
80
5.54
72
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
M 1 M
1
M
1 M
1
230
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
M Molpus Woodlands Group
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013 2012
14.27
5.25
3.52
1.55
-6.88
0.32
82
1.47
75
22.91
10.16
8.05
3.60
-14.98
0.48
84
2.59
78
32.72
15.91
11.17
2.44
-21.27
2.64
73
4.97
65
37.91
21.11
13.34
8.77
-10.78
7.02
79
10.50
68
32.06
14.95
10.40
2.97
-6.80
15.16
24
9.68
52
32.05
17.62
11.44
5.63
-7.03
0.77
87
7.75
69
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
M 1 M 1 M
1 M
1
M
1
M
1
231
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
High
1st Qt
Median
3rd Qt
Low
M Molpus Woodlands Group
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
6/17 3/17 12/16 9/16 6/16
22.32
11.83
9.43
4.77
-7.28
3.06
80
5.54
72
22.48
12.72
10.47
5.78
-13.60
3.12
81
5.67
75
23.19
13.89
11.73
5.99
-11.99
3.34
82
5.97
75
25.42
14.28
12.01
7.37
-9.40
4.42
81
7.60
74
30.13
14.72
12.67
8.00
-8.49
5.35
82
7.73
76
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
M
1
M
1
M
1 M
1
M
1
Molpus Woodlands Group
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
0.9
-5.7
-1.4
6.9
2.3
-2.6
-0.6 -0.9
-1.8
0.1
-1.4
-0.3
-1.6
1.2
-0.3 -0.6
0.0
-1.2
-0.4 -0.7
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. NCREIF Timberland Index
232
City of Clearwater Employees Pension Fund
Return vs Risk
Total Returns of Real Estate Portfolios
3 Years Ending 6/30/17
Annualized Rate of Return0.0 1.8 3.6 5.4 7.2 9.0 10.8 12.6 14.4 16.2 18.0
-4.0
-1.4
1.1
3.7
6.3
9.0
11.6
14.2
16.8
19.4
22.0
M
1 MedianRiskMedian
Return
Historical Standard Deviation of Return
Annualized Net of Fee Return Standard Deviation
Value Rank Value Rank
M Molpus Woodlands Group
1 NCREIF Timberland Index
Median
3.06 80 3.89 30
5.54 72 3.15 25
9.43 9.16
233
City of Clearwater Employees Pension Fund
Risk Measure Summary
Molpus Woodlands Group
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
0.30
0.25
0.00
0.68
1.01
1.01
0.65
0.02
0.12
0.00
0.80
29.74
1.00
-2.29
0
4
0.67
1.18
3.35
3.35
0.48
6.02
3
9
0.58
2.10
0.25
-0.87
6.14
0.48
6.31
3.89
1.08
-0.70
0.81
0.73
2.61
1.69
-1.40
1
11
-0.26
6.02
2.59
10.02
3.15
1.68
4
16
0.75
2.10
0.30
-0.87
7.86
0.48
16.17
4.61
0.45
0.50
0.14
1.11
11.30
4.82
-0.38
1
19
-0.26
6.02
2.59
10.64
3.74
1.87
8
16
0.66
2.02
0.25
-1.35
7.86
-2.71
16.17
4.47
0.53
0.17
0.18
0.84
7.15
4.42
-0.49
2
22
-0.35
6.02
1.13
10.64
3.60
1.66
234
City of Clearwater Employees Pension Fund
Hancock as of 6/30/17
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
5/31/12
Hancock NCREIF Timberland Index
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
5/31/12
Hancock
NCREIF Timberland Index
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
0.00
0.70
8,394
-68
0
8,326
-0.14
1.47
8,083
-68
311
8,326
-0.66
3.35
8,193
-136
268
8,326
2.56
5.54
4,642
2,965
719
8,326
4.80
7.16
1,263
5,773
1,290
8,326
5.52
7.17
1,263
5,788
1,274
8,326
Portfolio Performance (%)
235
City of Clearwater Employees Pension Fund
Hancock as of 6/30/17
Real Estate
$8,326 100.00%
Periods from 5/12 to 6/17
Alpha
Beta
R-Squared
-1.56
1.60
0.74
Annualized Return%
-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
H
1
T
Annualized Standard Deviation%
H Hancock
1 NCREIF Timberland Index
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
5.52
7.17
0.17
7.41
4.64
0.06
0.72
1.51
0.00
-0.50
Asset Allocation ($000)
Risk/Return Analysis
236
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
H Hancock
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
Last
Qtr
Last
Year
Last 2
Years
Last 3
Years
7.51
2.91
1.72
0.76
-6.74
0.00
81
0.70
76
23.99
8.77
4.99
-1.23
-13.60
-0.66
72
3.35
56
20.96
11.00
9.51
4.68
-9.99
2.00
82
3.37
79
22.32
11.83
9.43
4.77
-7.28
2.56
83
5.54
72
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
H 1 H
1 H 1 H
1
237
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
H Hancock
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
6/30/17
YTD 2016 2015 2014 2013
14.27
5.25
3.52
1.55
-6.88
-0.14
84
1.47
75
22.91
10.16
8.05
3.60
-14.98
-1.27
87
2.59
78
32.72
15.91
11.17
2.44
-21.27
4.51
67
4.97
65
37.91
21.11
13.34
8.77
-10.78
4.58
83
10.50
68
32.06
14.95
10.40
2.97
-6.80
8.91
55
9.68
52
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
H 1
H
1 H 1 H
1 H 1
238
City of Clearwater Employees Pension Fund
June 30, 2017
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
High
1st Qt
Median
3rd Qt
Low
H Hancock
Net Ret
Rank
1 NCREIF Timberland Index
Net Ret
Rank
6/17 3/17 12/16 9/16 6/16
22.32
11.83
9.43
4.77
-7.28
2.56
83
5.54
72
22.48
12.72
10.47
5.78
-13.60
2.38
83
5.67
75
23.19
13.89
11.73
5.99
-11.99
2.57
83
5.97
75
25.42
14.28
12.01
7.37
-9.40
6.49
78
7.60
74
30.13
14.72
12.67
8.00
-8.49
6.56
80
7.73
76
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
H
1
H
1
H
1 H 1 H 1
Hancock
Value Added Analysis - Net of Fee
9/12 12/12 3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15 12/15 3/16 6/16 9/16 12/16 3/17 6/17
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
-1.3
2.2
-3.5
-1.2 -1.4
5.6
-1.2
-1.6 -1.6
-1.1
-2.3
-0.9 -0.9
3.7
-0.2
-1.2 -1.2 -1.2 -0.9 -0.7
Cumulative Value Added
2 Yr Rolling Avg (Annualized)
Quarterly Value Added vs. NCREIF Timberland Index
239
City of Clearwater Employees Pension Fund
Risk Measure Summary
Hancock
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
2
2
-0.20
0.00
-0.52
0.00
-0.66
-0.66
0.49
-0.14
-0.19
0.06
-2.32
8.24
0.47
-8.24
0
4
0.67
1.18
3.35
3.35
0.48
6.02
8
4
0.48
1.89
0.08
-0.54
5.67
-1.27
4.72
4.35
0.96
-0.67
0.52
0.53
2.42
3.02
-0.95
1
11
-0.26
6.02
2.59
10.02
3.15
1.68
12
8
0.70
1.89
0.15
-1.83
11.90
-1.27
12.16
7.10
1.60
-1.51
0.74
0.67
2.99
4.28
-0.48
1
19
-0.26
6.02
2.59
10.64
3.74
1.87
12
8
0.70
1.89
0.15
-1.83
11.90
-1.27
12.16
7.10
1.60
-1.51
0.74
0.67
2.99
4.28
-0.48
1
19
-0.26
6.02
2.59
10.64
3.74
1.87
240
City of Clearwater Employees Pension Fund
U.S. Real Estate Investment Fund as of 6/30/17
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
Qtr YTD 1 Year 3 Year 5 Year 10 Year Incept
12/31/15
U.S. Real Estate Investment Fund NCREIF ODCE Fund Index
Net of Fee Returns Qtr YTD 1 Year 3 Year 5 Year 10 Year
Incept
12/31/15
U.S. Real Estate Investment Fund
NCREIF ODCE Fund Index
Asset Growth ($000)
Beginning Market Value
Net Contributions & Withdrawals
Gain/Loss + Income
Ending Market Value
1.18
1.70
11,242
0
133
11,375
3.53
3.50
11,081
-95
389
11,375
12.13
7.87
10,231
-95
1,240
11,375
9.53
8.21
5,708
4,204
1,462
11,375
Portfolio Performance (%)
241
City of Clearwater Employees Pension Fund
U.S. Real Estate Investment Fund as of 6/30/17
Real Estate
$11,375 100.00%
Periods from 12/15 to 6/17
Alpha
Beta
R-Squared
N/A
N/A
N/A
Annualized Return%
0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0 u
1
T
Annualized Standard Deviation%
u U.S. Real Estate Investm
1 NCREIF ODCE Fund I
T 91-Day Treasury Bill
Annualized
Net Ret
Std.
Dev.
Sharpe
Ratio
Info
Ratio
9.53
8.21
0.42
4.80
3.37
0.07
1.90
2.31
0.00
0.42
Asset Allocation ($000)
Risk/Return Analysis (Number of returns < 12)
242
City of Clearwater Employees Pension Fund
Cumulative Performance Comparison
Total Returns of Real Estate Portfolios
Periods Ending 6/17
High
1st Qt
Median
3rd Qt
Low
u U.S. Real Estate Investment Fund
Net Ret
Rank
1 NCREIF ODCE Fund Index
Net Ret
Rank
Last
Qtr
Last 2
Qtrs
Last 3
Qtrs
Last 4
Qtrs
7.51
2.91
1.72
0.76
-6.74
1.18
68
1.70
50
14.27
5.25
3.52
1.55
-6.88
3.53
49
3.50
51
18.61
6.44
2.91
-0.57
-8.96
8.22
14
5.68
32
23.99
8.77
4.99
-1.23
-13.60
12.13
14
7.87
33
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
u 1
u 1
u
1
u
1
243
City of Clearwater Employees Pension Fund
Calendar Year Performance Comparison
Total Returns of Real Estate Portfolios
Years Ending December
High
1st Qt
Median
3rd Qt
Low
u U.S. Real Estate Investment Fund
Net Ret
Rank
1 NCREIF ODCE Fund Index
Net Ret
Rank
6/30/17
YTD 2016
14.27
5.25
3.52
1.55
-6.88
3.53
49
3.50
51
22.91
10.16
8.05
3.60
-14.98
10.72
22
8.76
39
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
u 1
u
1
244
City of Clearwater Employees Pension Fund
Risk Measure Summary
U.S. Real Estate Investment Fund
Quarterly Periods Ending 6/30/17
Risk Measures
1 Year
Portfolio Bench
3 Years
Portfolio Bench
5 Years
Portfolio Bench
Inception
Portfolio Bench
Negative Periods
Positive Periods
Up Market Capture
Down Market Capture
Batting Average
Worst Quarter
Best Quarter
Worst 4 Quarters
Best 4 Quarters
Standard Deviation
Beta
Alpha
R-Squared
Sharpe Ratio
Treynor Ratio
Tracking Error
Information Ratio
0
4
1.54
0.75
1.18
4.53
12.13
12.13
2.93
1.80
-0.44
0.75
3.97
6.46
2.54
1.59
0
4
1.70
2.11
7.87
7.87
0.42
17.79
0
6
1.16
0.50
0.64
4.53
10.72
12.57
3.00
1.18
-0.03
0.33
3.04
7.69
2.95
0.42
0
6
1.70
2.18
7.87
8.76
0.41
19.06
245
246
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248
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-4043
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 1
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.5
SUBJECT/RECOMMENDATION:
Approve an agreement with Victory Capital for investment in their Sycamore Small Cap Value
Equity product, and authorize the appropriate officials to execute same.
SUMMARY:
One of the plan’s small cap value equity money managers, Systematic, has been
recommended for termination per a previous agenda item.
At the May 2017 pension investment committee quarterly meeting, the committee requested
the plan’s investment performance consultant, CapTrust Advisors, conduct a manager search
for a replacement small cap value equity manager. At a special meeting of the committee
during June 2017, the committee unanimously selected Victory Sycamore Small Cap Value
Equity for a due diligence interview of the firm, which was subsequently conducted at the
committee’s August 2017 quarterly meeting.
The pension investment committee unanimously recommends Victory Sycamore Small Cap
Value Equity to the Trustees for an investment of up to $15 million, or approximately 1.5% of the
total plan investment portfolio.
As of June 30, 2017, Sycamore Small Cap Value Equity’s performance over the past ten years
has been as follow:
Russell 2000
Performance Value Index
Last 3 years 11.08% 7.02%
Last 5 years 15.86% 13.39%
Last 10 years 9.52% 5.92%
Investment manager fees will be 1.0% on the first $10 million; and 0.85% on the next $15
million.
APPROPRIATION CODE AND AMOUNT:
0646-07410-530100-585-000-0000 $142,500 annually
Page 1 City of Clearwater Printed on 11/8/2017
{00094151.DOC;1}
Account No. ______________________
Company Tax ID: 59-6000289
INVESTMENT MANAGEMENT AGREEMENT
(non-ERISA)
VICTORY CAPITAL MANAGEMENT INC.
4900 Tiedeman Road, 4th Floor
Brooklyn, OH 44144
This management agreement (the “Agreement”), is entered into as of this day of
, 20____, by and between Victory Capital Management Inc., a New York corporation (the “Investment
Manager”), and City of Clearwater Employees’ Pension Fund (the “Client” or “Fund”).
1. The Client hereby grants to the Investment Manager, and the Investment Manager hereby accepts, full
discretionary authority to manage certain assets of the Client (the “Managed Assets”) and to effect in its sole
discretion the investment, reinvestment and liquidation of the Managed Assets in accordance with such objectives as
the Client may, from time to time, have furnished to the Investment Manager in writing, and subject only to such
limitations as the Client may impose. This appointment includes that of agent and attorney-in-fact with full
discretionary power and authority to effect transactions with respect to investment of the Managed Assets, to acquire
and dispose of securities of every description, including the exercise of rights and warrants to s ubscribe for
securities, and including investing in shares of an investment company to which the Investment Manager or any
affiliate serves as the investment adviser, all without prior consultation with the Client. The Investment Manager
acknowledges that it is a fiduciary with respect to the management of the assets of the Fund and that it is subject to
and shall be governed by the “prudent investor rule” as those terms are defined and interpreted under the provisions
of the Employee Retirement Income Security Act and under the provisions of the law of Florida. In the event the
Client shall suffer losses due to the negligence or willful misconduct of the Investment Manager, the Investment
Manager shall make the Client whole for any such losses. The Investment Manager shall indemnify and hold the
Client harmless from any and all liability resulting from the negligence or willful misconduct of the Investment
Manager. The Investment Manager shall not be liable for any losses or liability incurred due to the ne gligence or
willful misconduct of third parties, unless the third party was engaged by the Investment Manager to perform duties
under or related to this Agreement.
2. In consideration for its services under this Agreement, the Client agrees to pay the Investment Manager
a management fee, determined in accordance with the attached Schedule of Fees (attached hereto as Schedule A).
For the purpose of computing the management fee, the value of the Managed Assets (including debt securities,
commercial paper, treasury bills and any cash items) shall be calculated based upon the average month end market
value of the entire portfolio for each quarterly period or, in the absence of a market value, the fair value as
determined in good faith by the Investment Manager on the payable date of such stated period.
3. The Investment Manager is authorized to vote proxies solicited by or with respect to the issuers of
securities in which the Managed Assets may be invested as of the record date of voting such proxies unl ess the
Client, in an authorized writing delivered to the Investment Manager, specifically reserves to itself the authority to
vote proxies and precludes the Investment Manager from doing so. Investment Manager will not take any action or
render any advice with respect to any securities held in any accounts that are named in or subject to class action
lawsuits. Upon request, Investment Manager will provide reasonable assistance with requests for information in
Investment Manager’s possession that are related to legal actions associated with a security held or previously held
as part of the Managed Assets.
4. Consistent with obtaining best execution and as permitted under Section 28(e) of the Securities Exchange Act
of 1934, transactions for the Managed Assets may be directed to brokers in return for research and brokerage services
furnished by them to the Investment Manager. Such research may be used to service any or all of Investment Manager's
clients, and brokerage commissions paid by the Client may be used to pay for research that is not used in managing the
{00094151.DOC;1} 2
Managed Assets. The Investment Manager may, in its discretion, cause the Managed Assets to pay brokers a commission
greater than another qualified broker might charge to effect the same transaction where the Investment Manager
determines in good faith, and in accordance with its fiduciary duty, that the commission is reasonable in relation to the
value of the brokerage and research services received. The Client understands and agrees that the Investment
Manager’s discretionary authority hereunder with respect to the Managed Assets shall not impair or affect the
Investment Manager’s ability to buy or sell the same or similar securities or other property for the account of others.
In addition, the Client understands and agrees to the extent permitted by applicable law, the Investment Manager
may in transactions involving the Managed Assets act as agent while also representing another customer of the
Investment Manager which is the counterparty to such transaction.
5. The Client agrees that the Investment Manager may aggregate sales and purchase orders of the Managed
Assets with similar orders being made simultaneously for other portfolios managed by the Investment Manager if, in
the Investment Manager’s reasonable judgment, such aggregation shall result in an overall economic benefit to the
Managed Assets, taking into consideration the advantageous selling or purchase price, brokerage commission and
other expenses, and trading requirements. In accounting for such aggregated orders, price and commission shall be
averaged on a per bond or per share basis, provided, however, the portfolio managers have the discretion to fill
orders for certain accounts before others under certain circumstances as more fully described in the Investment
Manager’s Form ADV, Part II, as amended to date (or a separate brochure which contains the same information as is
in such Part II).
6. The Client will appoint a separate custodian (the “Custodian”) to take and have posses sion of the
Managed Assets. The Investment Manager shall issue instructions to the Custodian as may be appropriate in
connection with transactions with respect to the Managed Assets. The Investment Manager shall have no
responsibility or liability with respect to custody arrangement or the acts, omissions or other conduct of the
Custodian. Nothing contained herein shall be deemed to authorize the Investment Manager to take or receive
physical possession of any cash or securities in the Managed Assets.
7. The Investment Manager may place orders for the execution of transactions with or through such
brokers, dealers or banks as the Investment Manager may select, any one of which may be an affiliate of the
Investment Manager. The Client specifically agrees that although the Investment Manager exercises investment
discretion with respect to the Managed Assets, such affiliate may effect transactions in securities on the Client’s
behalf on any exchange of which such affiliate is a member and may receive and retain compensation for such
services, subject to the limitations and restrictions made applicable to such transactions by Section 11(a) of the
Securities Exchange Act of 1934 and Rule 11a2 -2(T) thereunder. However, if the Client is providing a directed
brokerage instruction, the Client has completed Schedule B attached hereto.
8. It is understood that, unless otherwise required by law, the Investment Manager, its shareholders,
directors, officers, employees or agents shall not have responsibility or l iability for any loss resulting from any act or
omission by the Client, the Custodian, or any broker or dealer designated by the Client for use with respect to the
Managed Assets or any agent or employee thereof. The Investment Manager may rely upon any s tatement,
representation, approval, direction or receipt of the Client, or any agent thereof.
9. The Client represents and warrants to Investment Manager that (a) it is experienced in the engagement
of investment managers and is aware of the risks associated with such engagements, including the risk that the
Managed Assets could suffer substantial diminution in value; (b) the terms of this Agreement do not violate any
obligation by which the Client is bound, whether arising by contract, operation of la w, or otherwise, (c) the Client
has the requisite power and authority to appoint Investment Manager to manage the Managed Assets; and (d) this
Agreement has been duly authorized by Client and, when executed and delivered, will be binding upon Client in
accordance with its terms.
10. The Client agrees to provide evidence, as requested, to any third party, to satisfy them as to the
authority of the Investment Manager hereunder.
11. The Client has provided instructions regarding the use of the Client’s name within the Investment
Manager’s representative client list(s) in the form of the attached Schedule C.
{00094151.DOC;1} 3
12. This Agreement cannot be assigned (as such term is defined in the Investment Advisers Act of 1940, as
amended) or transferred in any manner b y any party without the prior consent of all parties receiving or rendering
services under the Agreement. Notwithstanding the foregoing, Adviser may provide Client at least 45 days' advance
written notice of an assignment of this Agreement to a successor in interest to the Adviser and, unless Client objects
to such assignment in a written notice to Adviser on or before the date of assignment, Client shall be deemed to have
consented to such assignment.
13. The Investment Manager will periodically send t he Client a list of the investments of the Managed
Assets. The Investment Manager will instruct all brokers and dealers executing orders on behalf of the Managed
Assets to provide notification of all executed transactions to the Custodian.
To the extent reasonable and practicable, communications between the parties or to the Custodian shall be
made in writing or in another reasonable manner and promptly confirmed in writing. Written communications
should be addressed as follows:
If to the Client: City of Clearwater Employees’ Pension Fund
100 S. Myrtle Avenue
Clearwater, FL 33756
Attn: Finance Director
If to the Investment Manager: Victory Capital Management Inc.
4900 Tiedeman Road, 4th Floor
Brooklyn, OH 44144
ATTN:
With a Copy to the Chief
Compliance Officer: Victory Capital Management Inc.
4900 Tiedeman Road, 4th Floor
Brooklyn, OH 44144
Attn: Colin Kinney
If to the Custodian: The Northern Trust Company
50 S. LaSalle St, BB-8
Chicago IL, 60603
Attn: Claudiu Besoaga
Notice of change of any above-noted address shall be promptly sent to the other persons listed above.
14. This Agreement shall remain in effect until terminated by one of the parties hereto. This Agree ment
may be terminated by Client at any time by written notice to the other party hereto which shall be effective five (5)
days after the receipt of such notice or such earlier date as may be agreed to by the parties hereto. Investment
Manager may terminate this agreement with 60 days written notice to Client. In the event this Agreement is
terminated, any unpaid fees will be payable to the Investment Manager ratably based on the number of calendar days
prior to the termination date. However, all rights and obligations under Section 9, and Schedule B, if applicable, of
this Agreement, shall survive such termination.
15. This Agreement and any Schedules attached hereto constitute the sole understanding of the parties with
respect to the subject matter hereof.
16. The undersigned acknowledges receipt of the Investment Manager’s Form ADV, Part 2A and 2B,
as amended to date (or separate brochures which contain the same information) not later than the date hereof. The
Client agrees and consents to the electronic delivery or availability of all current and future agreements and
amendments thereto, Form ADV (or separate brochure), account statements, notices (including privacy notices),
letters, regulatory communications and other information, documents, da ta, records and reports related to its
account. Electronic communications may include email delivery and/or electronic communications via the
{00094151.DOC;1} 4
Investment Manager’s website. The Client acknowledges and agrees that any such electronic delivery or availabilit y
is at Investment Manager’s option and shall constitute a valid means of delivery if directed to the Client (if an
individual) or to the person or persons designated by the Client from time to time to receive such notice, including a
third party agent. The Client may revoke this consent at any time by providing advance written notice to the
Investment Manager.
17. The Investment Manager acknowledges that it is fully familiar with the laws of the State of Florida
governing public employee retirement systems (Chapter 112, Part VII), and is fully familiar with the provisions of
the City of Clearwater Code relating specifically to the investment management of the City of Clearwater
Employee’s Pension Fund. The Agreement shall be performed in accordance with all applicable federal, state, and
local laws and administrative regulations and shall in its interpretation be governed by the laws of the State of
Florida. Jurisdiction and venue for any disputes shall be in the state courts in Pinellas County, Flo rida. Should any
action be necessary to enforce the terms of this Agreement, the prevailing party shall be made whole, including any
costs and legal fees.
18. For so long as this Agreement remains effective, the Investment Manager shall promptly advise the
Client of any fee agreement or arrangement between the Investment Manager and any of its other clients that are
similarly situated to Client (e.g., type of client, anticipated account size, same strategy) that exist for the provision of
identical services for said clients that contains terms more favorable than those set forth in the then current Schedule
A (Fee Schedule). The Client shall automatically receive the benefit of any such favorable terms at its option.
19. The Investment Manager agrees to disclose, in writing to the Client within ten (10) business days, if
the Investment Manager becomes the subject of an investigation by the Securities and Exchange Commission for
alleged breach of federal securities laws; any investigation by the U.S. Department of Justice for allegations relating
to violation of federal securities laws or related allegations of fraud; or if the Investment Manager is named as the
defendant in any civil action alleging fraud, negligence with respect to its investment management services or
breach of fiduciary responsibility.
20. PUBLIC RECORDS.
(a) Pursuant to Florida Statutes §119.0701, Investment Manager will comply with public records
laws, specifically to:
(1) Keep and maintain public records required by the Fund to perform the service.
(2) Upon request from the Fund or its public records custodian, provide the Fund with a copy of the
requested records or allow the records to be inspected or copied within a reasonable time at a cost
that does not exceed the cost provided in this chapter or as otherwise provided by law.
(3) Ensure that public records that are exempt or confidential and exempt from public records disclosure
requirements are not disclosed except as authorized by law for the duration of the contract term and
following completion of the contract if the Investment Manager does not transfer the records to the
public agency.
(4) Upon completion of the contract, transfer, at no cost, to the Fund all public records in possession of
the Investment Manager or keep and maintain public records required by the Fund to perform the
service. If the Investment Manager transfers all public records to Fund upon completion of the
contract, Investment Manager shall destroy any duplicate public records that are exempt or
confidential and exempt from public records disclosure requirements; provided however Investment
Manager may retain such exempt or confidential information as may be automatically archived as
part of such party’s electronic back-up system or as may be required to be retained for legal,
regulatory, audit or compliance purposes, provided it is not available for general access and it
remains subject to the obligations of confidentiality hereunder for so long as it is so retained . If the
Investment Manager keeps and maintains public records upon completion of the contract, the
Investment Manager shall meet all applicable requirements for retaining public records. All records
stored electronically must be provided to the Fund, upon request from the Fund or its public records
custodian, in a format that is compatible with the information technology systems of the Fund.
IF THE INVESTMENT MANAGER HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119,
FLORIDA STATUTES, TO ITS DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT,
CONTACT THE CUSTODIAN OF PUBLIC RECORDS:
{00094151.DOC;1} 5
JAY RAVINS, FINANCE DIRECTOR
CITY OF CLEARWATER
100 SOUTH MYRTLE AVENUE
CLEARWATER, FL 33758
21. The Investment Manager shall for the term of this Agreement maintain an errors and omissions
insurance policy in the amount of ten million dollars. Additionally, the Investment Manager will maintain a fidelity
bond satisfying the requirements of Section 412 of ERISA and shall include the Client in its coverage. The
Investment Manager shall furnish the Client with proof of its coverage insurance and Bond, which is attached hereto
as Schedules “D” & “E.” Should there be any material reduction in the coverage or cancellation or non-renewal of
the policy, the Investment Manager shall immediately notify the Client.
22. The Investment Manager shall notify the Client of any change in the Investment Manager’s
ownership, key personnel, investment strategy, style or philosophy, or employees assigned to manage or service the
Client’s account within a reasonable time after such changes take place, not to exceed 30 days.
[Signature Page Follows]
{00094151.DOC;1} 6
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first written
above.
Agreed and Accepted as of ____ day of _________________, 20____.
City of Clearwater Employees’ Pension Fund
BY:
NAME: George N. Cretekos
TITLE: Chairperson
VICTORY CAPITAL MANAGEMENT INC.
BY:
NAME:
TITLE:
{00094151.DOC;1}A-1
SCHEDULE A
SCHEDULE OF FEES
This schedule is an integral part of the attached Investment Management Agreement between the Client and the
Investment Manager.
The schedule of annual fees for investment management services is as follows:
Assets Under Management Annual Fee Rate
On the first $10 million 1.00%
On the next $15 million 0.85%
On the next $25 million 0.80%
On the next $50 million 0.75%
Over $100 million 0.70%
Product: Sycamore Small Cap Value
Benchmark: Russell 2000 Value
In consideration for its services under this Investment Management Agreement, the Client agrees to pay the
Investment Manager a fee in arrears, on the last business day of each quarterly period. Said fee shall be calculated
based upon the average month-end market value of the entire portfolio for each quarterly period. In the absence of a
market value, the fair value will be reasonably determined by the Investment Manager on the payable date of each
such stated period.
Please initial selection below:
_____X Client will pay these fees directly.
OR
_____ The Client will authorize its Custodian to pay these fees directly from the custody
account. A copy of the invoice will be provided to the Custodian and the Client.
Depending upon the relationship, multiple portfolios with a commo n interest may be treated as one for billing
purposes.
Agreed and Accepted as of day of , 20____.
City of Clearwater Employees’ Pension Fund
BY:
NAME: George N. Cretekos
TITLE: Chairperson
VICTORY CAPITAL MANAGEMENT INC.
BY:
NAME:
TITLE:
{00094151.DOC;1}C-1
SCHEDULE B
Non-ERISA
DIRECTED BROKERAGE
(Equity Transactions Only)
The undersigned Client hereby directs the Investment Manager with respect to the particular brokers or
dealers to be utilized by the Investment Manager for portfolio trading for the Managed Assets (“Direc ted
Brokerage”), as listed below. The Client agrees that the receipt of any goods or services to be obtained from any
brokers, dealers or other persons on account of Directed Brokerage shall be negotiated by and is the responsibility of
the Client, and the Investment Manager shall have no responsibility therefor, except in fulfilling the Directed
Brokerage requirements if practicable. The Client acknowledges that with Directed Brokerage, the Investment
Manager’s services do not include selection of brokerage firms nor the negotiation of commission rates, and the
commission rates may not be as favorable as those which might be obtained if the Investment Manager undertakes
to select brokerage firms or negotiate rates with those firms selected. Victory Capit al Management may be unable to
obtain best execution when directed to use a particular broker. Also, due to the manual nature of directed trades,
they may be executed after discretionary trades in certain circumstances. The Investment Manager shall be
obligated to direct all brokerage transactions to the brokerage firms set forth below, and the Client acknowledges
that such brokerage firms may charge fees for their brokerage and other services.
Each Directed Brokerage instruction by the Client to the Investment Manager to use a designated broker
shall constitute a separate representation and warranty of the Client to the Investment Manager that any arrangement
for goods or services to be received on account of such Directed Brokerage shall be in conformi ty with any fiduciary
responsibilities of the Client and all applicable statutes and regulations to which the Client is subject and the Client
agrees to hold the Investment Manager, its officers, directors and employees (collectively, the “Covered Parties”)
harmless for, and to indemnify or insure the Covered Parties against, any costs, and liabilities (including e.g.,
attorneys’ fees and disbursements) which the Covered Parties may incur as a result of any claim against the Covered
Parties relating to such Directed Brokerage activity.
SELECTED BROKERS OR DEALERS:
Account Number Brokerage Firm Broker’s Name and Phone Number
______N/A________ _______________________ ____________________________
__________________ _______________________ ____________________________
__________________ _______________________ ____________________________
__________________ _______________________ ____________________________
BY:
City of Clearwater Employees Pension Plan
{00094151.DOC;1}C-1
SCHEDULE C
Non-ERISA
REPRESENTATIVE CLIENT LIST
The Investment Manager may, from time to time, provide a representative client list to prospective clients. The
Investment Manager in no way considers inclusion in the representative client list to be a testimonial. When
providing a representative client list to prospective clients, the following three items are disclosed:
1. The Investment Manager does not use performance -based criteria in determining which clients to
include in the list;
2. It is not known by the Investment Manager whether the listed clients approve or disapprove of the
Investment Manager or the advisory services provided; and,
3. A description of the objective criteria used by the Investment Manager to determine which clients to
include in the list.
Please initial selection below:
______X Yes, the Client grants the Investment Manager permission to utilize the Client’s
name in its representative client list.
______ No, the Client requests that the Investment Manager not include the Client’s
name in its representative client list.
Agreed and Accepted as of day of , 20____.
City of Clearwater Employees’ Pension Fund
BY:
NAME: George N. Cretekos
TITLE: Chairperson
{00094151.DOC;1} 10
SCHEDULE D
Non-ERISA
Proof of D&O/E&O Insurance
{00094151.DOC;1} 11
SCHEDULE D
Non-ERISA
Proof of Fidelity Bond
4900 Tiedeman Road, 4th Floor • Brooklyn, OH 44144 • 877-660-4400 • vcm.com
Page 1 of 2 Rev. 04.14
Please complete this form, sign, and send a scanned copy via encrypted email to compliance_victory@vcm.com,
send a fax to: (216) 898-2577, or mail to the above address.
Certificate of Rule 144A Qualified Institutional Buyer
The undersigned certifies to Victory Capital Management Inc. that the undersigned (1) is authorized to provide this
certificate on behalf of the entity listed below, (2) is familiar with Rule 144A (“Rule 144A”) under the Securities Act of
1933, as amended (the “Act”); (3) agrees that persons selling securities to or engaging in transactions with or on behalf
of the undersigned in reliance upon Rule 144A may rely on the information contained in this certificate; and (4) represents
and acknowledges that the entity is a Qualified Institutional Buyer (“QIB”), as defined in Rule 144A, of the following
type:
PLEASE PLACE A CHECK MARK IN THE APPLICABLE BOX(ES)
a. An entity referred to in sub-paragraphs (i) through (ix), acting for its own account or the accounts of other
QIBs, that in the aggregate owns and invests, on a discretionary basis1, at least $100 million in securities
of issuers that are not affiliated with the entity:
i. an insurance company as defined in Section 2(a)(13) of the Act. A purchase by a company
for one or more of its separate accounts, as defined by Section 2(a)(37) of the Investment
Company Act of 1940 (the “Investment Company Act”), which are neither registered under
Section 8 of the Investment Company Act nor required to be so registered, shall be deemed to be
a purchase for the account of such insurance company.
ii. an investment company registered under the Investment Company Act or any
business development company as defined in Section 2(a)(48) of that Act.
iii. a small business investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958.
iv. a plan established and maintained by a state, its political subdivisions, or any agency
or instrumentality of a state or its political subdivisions, for the benefit of its employees.
v. an employee benefit plan within the meaning of Title I of the Employee Retirement
Income Security Act of 1974 (“ERISA”).
vi. a trust fund whose trustee is a bank or trust company and whose participants are
exclusively plans of the types identified in paragraph (iv) or (v) above, except trust funds that
include as participants individual retirement accounts or H.R. 10 plans.
vii. a business development company as defined in Section 202(a)(22) of the Investment
Advisers Act of 1940 (the “Investment Advisers Act”).
viii. an organization described in Section 501(c)(3) of the Internal Revenue Code ,
corporation (other than a bank as defined in Section 3(a)(2) of the Act or a savings and loan
association or other institution referenced in Section 3(a)(5)(A) of the Act or a foreign bank or
1 In determining the aggregate amount of securities owned on a discretionary basis, please refer to Rule 144A (“Rule 144A”) under the Securities Act of
1933, as amended.
Page 2 of 2 Rev. 04.14
savings and loan association or equivalent institution), partnership, or Massachusetts or
similar business trust.
ix. an investment adviser registered under the Investment Advisers Act.
b. A dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934 (the “Exchange
Act”), acting for its own account or the accounts of other QIBs, that in the aggregate owns and
invests on a discretionary basis at least $10 million of securities of issuers that are not affiliated with the
dealer; provided, that securities constituting the whole or a part of an unsold allotment to or subscription
by a dealer as a participant in a public offering shall not be deemed to be owned by such dealer.
c. A dealer registered pursuant to Section 15 of the Exchange Act acting in a “riskless principal
transaction” on behalf of a QIB. For purposes of this clause C, “riskless principal transaction” means a
transaction in which a dealer buys a security from any person and makes a simultaneous offsetting sale
of such security to a QIB, including another dealer acting as riskless principal for a QIB.
d. An investment company registered under the Investment Company Act, acting for its own account
or for the accounts of other QIBs, that is part of a “family of investment companies” (as defined in Rule
144A) which own in the aggregate at least $100 million in securities of issuers, other than issuers that
are affiliated with the investment company or are part of such family of investment companies.
e. An entity, all of the equity owners of which are QIBs, acting for its own account of the accounts
of other QIBs.
f. A bank as defined in Section 3(a)(2) of the Act, any savings and loan association or other institution
as referenced in Section 3(a)(5)(A) of the Act, or any foreign bank or savings and loan association or
equivalent institution, acting for its own account or the accounts of other QIBs, that in the aggregate owns
and invests on a discretionary basis at least $100 million in securities of issuers that are not affiliated with
it and that has an audited net worth of at least $25 million as demonstrated in its latest annual financial
statements, as of a date not more than 16 months preceding the date of sale under Rule 144A in the case
of a U.S. bank or savings and loan association, and not more than 18 months preceding such date of
sale for a foreign bank or savings and loan association or equivalent institution.
OR, the undersigned certifies to Victory Capital Management Inc. that it is not a QIB or the investment
guidelines for the account prohibit investment in Rule 144A securities.
The undersigned agrees to notify Victory Capital Management Inc. if there is any change in the entity’s QIB
status as represented on this form.
Entity Name:
Victory Client Account No.:
Signature:
2nd Signature (if needed):
Printed Name:
Printed Name:
Signature Date: Signature Date:
City of Clearwater Employees' Pension Fund
George N. Cretekos, Chairman
Page 1 of 5
Name of Institution/Account City of Clearwater Employees’ Pension Fund
CERTIFICATION FOR THE PURCHASE OF
INITIAL PUBLIC OFFERINGS OF EQUITY SECURITIES
Pursuant to FINRA Rule 5130 (the “New Issue Rule”), firms may not sell or cause to be sold a new issue (as defined in the
New Issue Rule; generally, initial public offerings of equity securities) to any account in which a restricted person holds a
beneficial interest unless the account qualifies for a general exemption under the New Issue Rule. As a precondition to
selling a new issue to any account, FINRA requires that you sign and return a certificate indicating whether or not your
account is eligible to purchase IPO shares in accordance with the New Issue Rule. In addition, in connection with any new
issue, you hereby represent that you will not act as a finder or in a fiduciary capacity to any managing underwriter of any
new issue and that you shall notify us immediately in the event that such representation ceases to be true and correct.
In addition, pursuant to FINRA Rule 5131 (the “IPO Allocation Rule”), firms may not under certain circumstances, subject
to certain exemptions, allocate shares of a new issue to any account in which an executive officer or director of a public
company or a covered non-public company, or a person materially supported by such executive officer or director
(collectively, “Covered Persons”), has a beneficial interest unless the account qualifies for a general exemption.
All bolded terms relating to the New Issue Rule or the IPO Allocation Rule are defined in Annex A attached.
PLEASE CHECK ONE BOX FROM SECTION “A” AND ONE BOX FROM SECTION “B”, AND COMPLETE
THE ACCOUNT INFORMATION BELOW.
The undersigned hereby certifies that with respect to each account in which it has the opportunity to purchase and/or allocat e
new issues:
SECTION A. NEW ISSUE RULE (FINRA RULE 5130) (CHECK ONE BOX ONLY)
The account is eligible to purchase new issues either because (i) no restricted person (based on the definition in Annex
A) holds a beneficial interest in the account, or (ii) the account meets a general exemption listed on Annex A, or (iii)
the account has implemented procedures to reduce the beneficial interests of all restricted persons with respect to new
issues to in the aggregate below 10%, and the undersigned hereby represents that it will follow such procedures in
connection with the purchase by the account of all new issues; OR
The undersigned is a conduit (such as a bank, foreign bank, broker/dealer, or investment adviser) and all purchases of
new issues are, and will be, in compliance with the New Issue Rule. If the beneficial interests of all restricted persons
in any one account exceeds in the aggregate 10% of the account but the account has implemented procedures to reduce
the beneficial interest of all restricted persons with respect to new issues to in the aggregate below 10%, the
undersigned hereby represents that it will follow such procedures in connection with the purchase by the account of all
new issues; OR
The account is a restricted person and is not eligible to purchase new issues; OR
The investment guidelines for the account prohibit, or the account has elected not to participate in, the purchase of new
issues.
Page 2 of 5
SECTION B. IPO ALLOCATION RULE (FINRA RULE 5131) (CHECK ONE BOX ONLY)
The undersigned hereby certifies that the account(s) is eligible to purchase new issues on or after the date hereof either
because:
(i) No person that holds a beneficial interest in the account is a Covered Person, or
(ii) The account meets a general exemption (See Annex A), or
(iii) The account is beneficially owned by Covered Person(s) who in the aggregate owns less than 25% of the
account.
The account is held by one or more Covered Person(s) of a particular company, whose beneficial interest, in the
aggregate, exceeds 25% of the account, and the account has implemented procedures to reduc e the beneficial interests
of all Covered Persons of a particular company with respect to new issues to in the aggregate below 25%, and the
undersigned hereby represents that it will follow such procedures in connection with the purchase by the account(s) of
all new issues.
The account is held by one or more Covered Person(s) of a particular company, whose beneficial interest, in the
aggregate, exceeds 25% of the account, and the account has not implemented procedures to reduce the beneficial
interests of all Covered Persons of a particular company with respect to new issues to in the aggregate below 25%.
The investment guidelines for the account(s) prohibit, or the account(s) has elected not to participate in, the purchase
of new issues.
The undersigned hereby certifies that the undersigned is authorized to provide this Certification and that the undersigned, o r
an authorized representative of the account, will promptly notify Victory Capital Management in the event this Certification
ceases to be true and correct. In connection to the U.S. Securities & Exchange Commission’s electronic delivery of
information requirements, the undersigned agrees to receive electronic mail for the purpose of recertifying this Certificatio n
through negative consent and to notify Victory Capital Management in writing if the undersigned does not agree to receive
such communications.
Name of Institution/Account City of Clearwater Employees’ Pension Fund
Company Street Address 100 S. Myrtle Avenue
City/State/Zip Code/Country Clearwater, FL 33756
Tax ID/EIN/Reg. No. 59-6000289
Authorized Signatory Signature Date
George N. Cretekos Chairperson
Name (Print/Type) Title (Print/Type)
727-562-4050 George.Cretekos@myClearwater.com
Business Telephone Number Business Email
Page 3 of 5
ANNEX A
General Exemptions:
1. An investment company registered under the Investment Company Act of 1940 .
2. A common trust fund or similar fund as described in Section 3(a)(12)(A)(iii) of the Securities Exchange Act of 1934,
provided that: (i) the fund has investments from 1,000 or more accounts, and (ii) the fund does not limit beneficial
interests in the fund principally to trust accounts of restricted persons.
3. An insurance company general, separate or investment account, provided: (i) the account is funded by premiums from
1,000 or more policyholders or, if a general account, the insurance company has 1,000 or more policyholders, and (ii) the
insurance company does not limit the policyholders whose premiums are used to fund the account principally to
restricted persons, or if a general account, the insurance company does not limit its policyholders principally to restricted
persons.
4. A collective investment account, including a fund, limited partnership, joint back office broker-dealer or other entity, if
the beneficial interests of:
a. For purposes of Section A, restricted persons, in the aggregate, do not exceed 10% of the account under the
New Issue Rule (FINRA Rule 5130);
b. For purposes of Section B, covered persons of a particular company, in the aggregate, do not exceed 25% of
the account under the IPO Allocation Rule (FINRA Rule 5131).
5. A publicly traded entity (other than a broker-dealer authorized to engage in the public offering of new issues either as a
selling group member or underwriter, or an affiliate of such a broker -dealer) that is: (i) listed on a U.S. national securities
exchange, (ii) a non-U.S. issuer whose securities meet the quantitative designation criteria for listing on a national
securities exchange.
6. An investment company organized under the laws of a non-U.S. jurisdiction, provided that: (i) the investment company
is listed on a non-U.S. exchange or authorized for sale to the public by a non-U.S. regulatory authority, and (ii) no person
owning 5% or more of the shares of the investment company is a restricted person.
7. An ERISA benefit plan that is qualified under Section 401(a) of the Internal Revenue Code; provided that the plan is not
sponsored solely by a broker-dealer.
8. A state or municipal government benefits plan that is subject to state and/or municipal regulation.
9. A tax-exempt charitable organization under Section 501(c)(3) of the Internal Revenue Code.
10. A church plan under Section 414(e) of the Internal Revenue Code.
New Issue Rule and IPO Allocation Rule Definitions
Associated person or employee of a FINRA member firm. (1) Any natural person who is registered or has applied for
registration with FINRA; (2) any natural person, whether or not registered or exempt from registration with FINRA, who is a
sole proprietor, partner, officer, director, or branch manager of a FINRA member firm, or any natural person occupying a
similar status or performing similar functions; or (3) any natural person engaged in the investment banking or securities
business who is directly or indirectly controlling or controlled by a FINRA member firm (for example, as a result of being an
employee of the FINRA member).
Beneficial interest. Any economic interest, including the right to share in gains or losses, other than management or
performance based fees for operating a collective investment account, or other fees for acting in a fiduciary capacity.
Collective investment account. Any hedge fund, investment partnership, investment corporation, or any other collective
investment vehicle that is engaged primarily in the purchase and sale of securities, but not (i) a legal entity that is beneficially
owned solely by immediate family members or (ii) an investment club comprising a group of friends, neighbors, business
associates or others who pool their money to invest in stock or other securities and are collectively responsible for making
investment decisions.
Page 4 of 5
Covered non-public company. Any non-public company satisfying the following criteria: (i) income of at least $1 million in
the last fiscal year or in two of the last three fiscal years and shareholders' equity of at least $15 million; (ii) sharehol ders'
equity of at least $30 million and a two-year operating history; or (iii) total assets and total revenue of at least $75 million in
the latest fiscal year or in two of the last three fiscal years.
Covered Person. An executive officer or director of a public company or a covered non-public company, or a person
materially supported by such executive officer or director.
Executive officer or director. Any (i) person named as an executive officer or director in a U.S. public company’s most
recent proxy filed with the SEC or in an annual report filed with the SEC on Form 10 -K or Form 20-F, (ii) executive officer
or director of a foreign company that is registered with the SEC under the ’34 Act, as amended, or (iii) executive officer or
director of a covered non-public company.
Finder. A person who receives compensation for identifying potential investors in an offering.
FINRA Member. A member of the Financial Industry Regulatory Authority or any person or entity associated with a
FINRA member firm.
Immediate family member. A person’s parents, mother-in-law or father-in-law, spouse, brother or sister, brother-in-law or
sister-in-law, son-in-law or daughter-in-law and children, and any other individual to whom the person provides material
support.
IPO Allocation Rule. FINRA Rule 5131.
Limited business broker-dealer. Any broker-dealer whose authorization to engage in the securities business is limited
solely to the purchase and sale of investment company/variable contracts securities and direct participation program
securities.
Material support. Directly or indirectly providing more than 25% of a person’s income in the prior calendar year. Members
of the immediate family living in the same household are deemed to be providing each other with material support.
New issue. Any initial public offering of an equity security, as defined in Section 3(a)11 of the Securities Exchange Act of
1934, as amended, made pursuant to a registration statement or offering circular.
New Issue Rule. FINRA Rule 5130.
Public Company. Any company that is registered under Section 12 of the Securities Exchange or files period reports
pursuant to Section 15(d) thereof.
Restricted Persons/Entities.
1. A FINRA member firm or other broker-dealer.
2. An officer, director, general partner, associated person or employee of a FINRA member firm or any other broker-
dealer (other than a limited business broker-dealer).
3. An agent of a FINRA member firm or any other broker -dealer (other than a limited business broker-dealer) that is
engaged in the investment banking or securities business.
4. A person who has authority to buy or sell securities for a bank, savings and loan association, insurance company,
investment company, investment adviser (whether or not registered as an investment advi ser) or collective investment
account.
5. A person listed, or required to be listed, on one of the following schedules to Form BD as filed, or required to be filed,
with the SEC by a broker-dealer (other than with respect to a limited broker -dealer): (i) Schedule A, unless the person is
identified by an ownership code of less than 10%; (ii) Schedule B, unless the person’s listing on Schedule B relates to an
ownership interest in a person that is listed on Schedule A and identified by an ownership code of less than 10%; or (iii)
Schedule C, unless the person would be excluded under the percentage owners hip criteria for Schedule A or B above.
Page 5 of 5
6. A person that directly or indirectly owns (i) 10% or more of a public reporting company listed, or required to be listed,
on Schedule A of Form BD (other than a reporting company that is listed on a national s ecurities exchange or other than
with respect to a limited business broker-dealer), or (ii) 25% or more of a public reporting company listed, or required to
be listed, on Schedule B of Form BD (other than a reporting company that is listed on a national se curities exchange or
other than with respect to a limited business broker-dealer exchange.
7. A person who acts as a finder or acts in a fiduciary capacity (including but not limited to attorneys, accountants and
financial consultants) to any entity that at any time serves or may serve as a managing underwriter(s) of a new issue.
8. An immediate family member of: (i) a person specified in items 2-7 that materially supports, or receives support
from, that person; (ii) a person specified in items 2-3 that is employed by or associated with the FINRA member or any
of its affiliate selling the new issue to the immediate family member, or that has an ability to control the allocation of th e
new issue; or (iii) a person specified in items 5-6 that is an owner of the FINRA member or any of its affiliate selling the
new issue to the immediate family member, or that has an ability to control the allocation of the new issue.
VICTORY CAPITAL MANAGEMENT INC.
INVESTMENT ADVISER BROCHURE
FORM ADV PART 2A
MARCH 31, 2017
4900 Tiedeman Road, 4th Floor
Brooklyn, Ohio 44144
Phone: (877) 660-4400
www.vcm.com
www.victoryshares.com
www.rsinvestments.com
www.integrityasset.com
www.compassemp.com
This brochure provides information about the qualifications and business practices of Victory
Capital Management Inc. If you have any questions about the contents of this brochure,
please contact us at (216) 898-2400. The information in this brochure has not been approved
or verified by the United States Securities and Exchange Commission (“SEC”) or by any state
securities authority.
Victory Capital Management Inc. is a registered investment adviser. Registration as an
investment adviser does not imply a certain level of skill or training. Additional information about
Victory Capital Management Inc. is available on the SEC’s website at:
http://www.adviserinfo.sec.gov.
Page | 1
ITEM 2: MATERIAL CHANGES
Since the last update of this brochure on September 19, 2016, Victory Capital has made the
following changes to this brochure:
Disclosure was added to Items 4, 5 and 7 in connection with Victory Capital’s
appointment as an Investment Manager of Victory Sophus Emerging Markets UCITS
Fund and Victory Expedition Emerging Markets Small Cap UCITS Fund, sub-funds of
Dublin-based Carolon Investments Funds plc.
Disclosure was added to Items 10 and 11 in connection with Victory Capital’s acquisition
of a minority interest in Cerebellum Capital, LLC
Victory Capital’s Privacy Policy was added to the end of this ADV
Page | 2
ITEM 3: TABLE OF CONTENTS
ITEM 1: COVER PAGE
ITEM 2: MATERIAL CHANGES
ITEM 3: TABLE OF CONTENTS
ITEM 4: ADVISORY BUSINESS ................................................................................................ 3
ITEM 5: FEES AND COMPENSATION ...................................................................................... 8
ITEM 6: PERFORMANCE-BASED FEES AND SIDE-BY-SIDE MANAGEMENT ......................16
ITEM 7: TYPES OF CLIENTS ...................................................................................................17
ITEM 8: METHODS OF ANALYSIS, INVESTMENT STRATEGIES AND RISK OF LOSS........18
ITEM 9: DISCIPLINARY INFORMATION ..................................................................................37
ITEM 10: OTHER FINANCIAL INDUSTRY ACTIVITIES AND AFFILIATIONS ..........................38
ITEM 11: CODE OF ETHICS, PARTICIPATION OR INTEREST IN CLIENT TRANSACTIONS
AND PERSONAL TRADING .....................................................................................................41
ITEM 12: BROKERAGE PRACTICES .......................................................................................44
ITEM 13: REVIEW OF ACCOUNTS ..........................................................................................52
ITEM 14: CLIENT REFERRALS AND OTHER COMPENSATION ............................................53
ITEM 15: CUSTODY .................................................................................................................54
ITEM 16: INVESTMENT DISCRETION .....................................................................................55
ITEM 17: VOTING CLIENT SECURITIES .................................................................................56
ITEM 18: FINANCIAL INFORMATION ......................................................................................57
ITEM 19: REQUIREMENTS FOR STATE-REGISTERED ADVISERS ......................................58
APPENDIX A ............................................................................................................................59
Page | 3
ITEM 4: ADVISORY BUSINESS
GENERAL
Victory Capital Management Inc. (“Victory Capital”) is an investment advisory firm registered
with the SEC as an investment adviser under the Investment Advisers Act of 1940 , as amended
(“Advisers Act”) that has provided investment advisory services (through its predecessor firms)
since 1912. Victory Capital’s multi-boutique structure is comprised of the following autonomous
investment franchises: CEMP, Diversified Equity Management, Expedition Investment Partners,
INCORE Capital Management, Integrity Asset Management, Munder Capital Management,
NewBridge Asset Management, RS Investments, Sophus Capital, Sycamore Capital, and
Trivalent Investments (each, an “investment franchise”). Collectively, Victory Capital’s
investment franchises manage investment strategies in a variety of asset classes (such as
equity, fixed income and mixed asset classes) and through a variety of styles (such as active
management, passive management, smart beta and asset allocation).
OWNERSHIP AND LOCATIONS
Victory Capital is an indirect, wholly owned subsidiary of Victory Capital Holdings, Inc. (“VCH”).
Crestview Partners II, L.P. (and its affiliated funds) is the majority owner of VCH, with the
remaining portion owned by Victory Capital employees and a limited number of outside
investors.
Victory Capital is headquartered in Brooklyn, OH, and has offices in Birmingham, MI, Boston,
MA, Brentwood, TN, Cincinnati, OH, Des Moines, IA, Greenwood Village, CO, New York, NY,
and Rocky River, OH, San Francisco, CA, as well as Hong Kong, Singapore, and the United
Kingdom.
TYPES OF ADVISORY SERVICES
Through its separate investment franchises, each with its own investment teams and unique
strategies, Victory Capital provides continuous investment management advice either directly or
indirectly (i.e., through certain financial intermediaries) to (1) institutional clients (as described in
Item 7 herein) and high net worth individuals (institutional clients and high net worth individuals,
together, “separate accounts”), (2) collective investment trusts, exchange traded funds
(“ETFs”), private funds, Undertaking for Collective Investment in Transferable Securities
(“UCITS”) funds, and affiliated and unaffiliated registered investment companies (collectively,
“pooled vehicles”), and (3) clients who participate in wrap fee programs (as described below).
Victory Capital also oversees the management of fixed-income and natural resources equity
pooled investment vehicles, which are sub-advised by other investment advisers.
As of December 31, 2016, Victory Capital had approximately $53.2 billion in client assets under
management on a discretionary basis and approximately $1.8 billion in client assets under
management on a non-discretionary basis.1
1 AUM figures are not adjusted for assets of proprietary funds in other funds or client accounts.
Page | 4
INVESTMENT ADVISORY SERVICES PROVIDED DIRECTLY TO CLIENTS
Victory Capital provides continuous investment management advice directly to (1) separate
accounts and (2) pooled vehicles. Investors should note that investment decisions for separate
accounts are provided at the client account level, whereas the investment decisions for pooled
vehicles are made at the fund level. Thus, investment decisions that are made for separate
accounts may vary from one client to another, whereas decisions made at the fund level will
affect all fund investors.
Direct Investment Advisory Services to Separate Accounts
A client with a separate account enters into an investment advisory agreement with Victory
Capital. This agreement, together with any investment policy statement or similar guidelines
provided by the client, stipulates the investment strategies, objectives, restrictions (which may
include (without limitation) restrictions on: the market-capitalization of investments held in the
account, cash levels permitted in the account, the purchase of foreign securities, or the types of
investments or techniques that may be used in managing the account) and guidelines
applicable to the client’s account (the “investment mandate”) and includes provisions relating
to investment management fees, voting rights and termination rights. As a separate account,
the investment management advice that Victory Capital provides to these clients – and how the
investor will be affected by investment decisions – will vary from one client to another.
Victory Capital may from time to time, subject to applicable law, discuss with clients or potential
clients (upon their request) one or more issuers (public or private) which it does not then hold in
any portfolio managed by it, and which it may or may not be considering for investment. Any
such discussions are solely for the information and convenience of a client or potential client,
and are not intended to constitute investment advice (except to the extent such discussions are
investment advisory services specifically contemplated by the investment advisory agreement
between Victory Capital and a client). Such discussions may include, among other things, the
views of an investment team at Victory Capital regarding the issuer or its securities, the issuer’s
financial condition or prospects, or the merits generally of an investment (or non-investment) in
that issuer or any industry or sector of which that issuer is a part. Victory Capital is under no
obligation to enter into such discussions with any client or all clients, and may have such
discussions only with certain clients in its sole discretion. Victory Capital will not, as a result of
any such discussion, be limited in any way from purchasing or selling investments of any such
issuer, including investments that may be or appear to be inconsistent with the views expressed
in such discussion.
Direct Investment Advisory Services to Pooled Vehicles
Victory Capital also provides investment management advice directly to affiliated and
unaffiliated pooled vehicles. Victory Capital provides investment management advice to these
pooled vehicles according to the investment mandate that is outlined in its offering and
governing documents. Although there may be many investors in pooled vehicles, the
investment mandate is not tailored to each investor’s needs the way separate accounts are
tailored to each client. Thus, the investment management advice that Victory Capital provides
to these clients (i.e., the pooled vehicles) – and how investors in them will be affected by
investment decisions – will not vary from one investor to another. In fact, all investors in the
pooled vehicle will be affected the same way.
Page | 5
i. Affiliated pooled vehicles. Victory Capital serves as the investment adviser to the
separate series of the following affiliated pooled vehicles: Victory Capital Collective
Investment Trust, Victory Capital International Collective Investment Trust and the
Victory Funds. “Victory Funds” means the individual series portfolios of Victory
Portfolios, Victory Portfolios II, Victory Variable Insurance Funds, and Victory
Institutional Funds, each an investment company registered under the Investment
Company Act of 1940, as amended (the “1940 Act”).
ii. Unaffiliated pooled vehicles. Victory Capital acts as investment sub-advisor to
unaffiliated registered investment companies (such as mutual funds and ETFs) and
other non-registered pooled vehicles. Victory Capital acts as a sub-adviser for the
registered investment companies that are disclosed in Part 1 of Form ADV. Victory
Capital acts as investment manager to certain sub-funds of Carolon Investment
Funds plc, a UCITS product for non-U.S. investors. Carolon Investment Funds plc
operates as an open-ended umbrella investment company with variable capital and
segregated liability between sub-funds incorporated with limited liability in Ireland
under the Companies Acts 1963 to 2013 with registration number 552000 and
established as a UCITS fund pursuant to the European Communities UCITS
Regulations, 2011 (S.I Number 352 of 2011). Victory Capital entered into an
Investment Management Agreement and is responsible on a discretionary basis for
managing the investment and reinvestment of certain of the assets of Carolon
Investment Funds plc and its sub-funds. Victory Sophus Emerging Markets UCITS
Fund and Victory Expedition Emerging Markets Small Cap UCITS Fund (collect ively,
the “Victory UCITS”) are currently the only sub-funds of Carolon Investment Funds
plc for which Victory Capital acts as investment manager.
INVESTMENT ADVISORY SERVICES PROVIDED
THROUGH INTERMEDIARIES OR INDIRECTLY TO CLIENTS
Victory Capital provides investment advisory services through intermediaries or indirectly to
clients who participate in wrap fee programs (as described below).
Wrap Fee Accounts
Victory Capital provides investment management advice indirectly through third party
intermediaries to investors who participate in “wrap fee programs”. According to Rule 204-
3(h)(5) of the Advisers Act, a wrap fee program is any advisory program under which a client is
charged a specified fee or fees not based directly on transactions in the client’s account for
investment advisory services (which may include portfolio management or advice concerning
the selection of other advisers) and execution of client transactions.
Wrap fee programs are sponsored, organized or administered by the “wrap fee sponsor.” The
wrap fee sponsor provides advice to clients regarding, among other things, the selection of
other investment advisers in the program. In most wrap fee programs, the wrap fee sponsor
has direct contact with the wrap fee client and, through client consultation, will establish the
investment mandate. Victory Capital provides investment advisory services to two types of
wrap fee programs: i) on a non-discretionary basis, to unified managed account programs
(“UMA programs”), which are sponsored by other investment advisers (“UMA sponsors”); and
ii) on a discretionary basis, to programs with separately managed accounts (“SMA programs”),
Page | 6
which are sponsored by other registered investment advisers or broker-dealers (the “SMA
sponsors”).
Wrap fee sponsors should provide wrap fee clients with the sponsor’s wrap fee brochure
(Schedule H of the wrap sponsor’s form ADV) and the brochure for each discretionary
investment adviser or sub-adviser that is used by the wrap fee client.
i. Unified managed accounts. When Victory Capital provides
non-discretionary investment advisory services to UMA
accounts, Victory Capital creates and provides the UMA
sponsor with security recommendations (a “model
portfolio”). As stated previously, the investment mandate
stipulates the UMA client’s investment strategies,
objectives, restrictions and guidelines. The wrap fee is
based upon a percentage of the market value of the UMA
sponsor’s accounts. Victory Capital receives a portion of
the fee charged by the wrap fee sponsor.
The UMA sponsor retains full discretion to accept, modify or reject the model portfolio and, in
most cases, executes any securities transactions for the UMA client. UMA clients are clients of
the UMA sponsor; they are not clients of Victory Capital. The UMA sponsor bears the
responsibility to determine whether an investment is or continues to be appropriate for the UMA
client.
ii. Separately managed accounts. Victory Capital provides
investment advisory services to SMAs. In SMA programs,
the client (“SMA client”) may enter into a wrap fee
agreement (“wrap fee agreement”) with the SMA sponsor.
Alternatively, the SMA client may enter into an agreement
with both the SMA sponsor and Victory Capital as the
investment adviser (a “dual contract”).
SMA clients are charged a single, all-inclusive fee by the wrap sponsor, which covers services
provided by both the wrap sponsor and the investment adviser. The wrap fee is based upon a
percentage of the market value of the SMA client’s account. Victory Capital receives a portion
of the fee charged by the wrap sponsor. Typically, the SMA wrap sponsor will assist the SMA
client with choosing one or more investment advisers or sub-advisers from a group of
investment advisers that are available under the program (based on the client’s investment
mandate).
Victory Capital does not determine whether a particular wrap fee program is suitable or
advisable for any client. Rather, the wrap sponsor determines whether the investment strategy
provided by Victory Capital is suitable for the client. Victory Capital may accept or reject a wrap
client for any reason.
There are several notable differences between the UMA program and the SMA program. As
noted previously, in the UMA program, the UMA sponsor (not Victory Capital) generally
executes securities transactions for the UMA client. However, in the SMA program, Victory
Capital (not the SMA sponsor) executes securities transactions on behalf of the SMA client.
Additionally, Victory Capital may allow certain restrictions for SMA clients or the SMA program
Page | 7
in ways that it may not for the UMA program. For example, Victory Capital allows SMA clients
to place some restrictions on the securities that can be held in their account. Currently, Victory
Capital permits SMA clients to have up to twenty (20) securities restricted in their investment
mandate.
Page | 8
ITEM 5: FEES AND COMPENSATION
In most cases, Victory Capital is paid an asset-based fee for its advisory services, at rates which
vary, based primarily on the type of strategy and the type and size of the account. Certain
separate accounts pay Victory Capital an advisory fee structured as a performance-based fee
which is a modification of the standard asset-based fee.
ASSET BASED FEES
Victory Capital’s asset-based fee schedules for new separate accounts are listed below.
Advisory fees may be negotiated in limited circumstances, depending on the nature of the
client’s portfolio and investment objectives. When Victory Capital negotiates fees, it may take
into account the strategy and size of the account and the overall relationship with Victory
Capital. For example, accounts with a family or business relationship to each other may be
aggregated in order to apply advisory fee breakpoints. On occasion, Victory Capital may agree
to fixed (or flat) fee arrangements. Victory Capital may impose minimum sizes and minimum
annual fees. Victory Capital reserves the right to waive fees, reduce mandatory minimums, or
to close a strategy to new or existing investors. Fees may be waived or reduced for investors
who are affiliates of Victory Capital, employees of Victory Capital or its affiliates (or family
members of such employees), and certain other investors as determined by Victory Capital, in
its sole discretion.
Victory Capital receives asset based fees for the advisory services it provides to the Victory
Funds, other pooled vehicles and wrap clients that are different from what are shown below.
Investors in these products should consult the offering documents or wrap program brochure for
more information about Victory Capital’s advisory fees.
Domestic Equity
Diversified Equity
Management Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Diversified Equity Large Cap Core $10M / $60K
0.60% on the first $25M
0.50% on the next $25M
0.45% on the next $50M
0.40% on assets exceeding $100M
NewBridge Asset
Management Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
NewBridge Large Cap
Growth Equity
Large Cap
Growth $10M / $65K
0.65% on the first $25M
0.55% on the next $25M
0.45% on the next $50M
0.40% on assets exceeding $100M
NewBridge Global
Equity Global Equity $10M / $80K
0.80% on the first $25M
0.70% on the next $25M
0.60% on the next $50M
0.40% on assets exceeding $100M
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RS Investments
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
RS Small Cap Value
Strategy Small Cap Value $10M / $100K
1.00% on the first $30M
0.80% on the next $20M
0.60% on assets exceeding $50M
RS Mid Cap Value
Strategy Mid Cap Value $10M / $85K
0.85% on the first $30M
0.68% on the next $20M
0.50% on assets exceeding $50M
RS Large Cap Value
Strategy Large Cap Value $10M / $50K
0.50% on the first $30M
0.45% on the next $20M
0.40% on assets exceeding $50M
RS Concentrated All
Cap Strategy All Cap Value $10M / $85K
0.85% on the first $30M
0.80% on the next $20M
0.75% on assets exceeding $50M
RS Small Cap Growth
Strategy
Small Cap
Growth $10M / $100K
1.00% on the first $30M
0.80% on the next $20M
0.60% on assets exceeding $50M
RS Small/Mid Cap
Growth Strategy
Small and Mid
Cap Growth $10M / $100K
1.00% on the first $30M
0.80% on the next $20M
0.60% on assets exceeding $50M
RS Mid Cap Growth
Strategy Mid Cap Growth $10M / $85K
0.85% on the first $30M
0.68% on the next $20M
0.50% on assets exceeding $50M
RS Large Cap Growth
Strategy
Large Cap
Growth $10M / $80K
0.80% on the first $30M
0.70% on the next $20M
0.60% on assets exceeding $50M
Sycamore Capital
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Sycamore Mid Cap
Value Equity Mid Cap Value $10M / $75K
0.75% on the first $25M
0.70% on the next $25M
0.65% on the next $50M
0.60% on assets exceeding $100M
Sycamore Small Cap
Value Equity
Small Cap
Value $10M / $100K
1.00% on the first $10M
0.85% on the next $15M
0.80% on the next $25M
0.75% of the next $50M
0.70% on assets exceeding $100M
Munder Capital
Management
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Large Cap Growth Large Cap
Growth $10M / $60K
0.60% on the first $25M
0.50% on the next $25M
0.45% on the next $50M
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0.40% on assets exceeding $100M
Multi Cap Growth Multi Cap
Growth $10M / $60K
0.60% on the first $25M
0.50% on the next $25M
0.45% on the next $50M
0.40% on assets exceeding $100M
Core Growth Large Cap Core
Growth $10M / $65K
0.65% on the first $25M
0.60% on the next $25M
0.50% on the next $50M
0.45% on assets exceeding $100M
Mid Cap Core Growth Mid Cap Core
Growth $10M / $75K
0.75% on the first $25M
0.60% on the next $25M
0.55% on the next $50M
0.50% on assets exceeding $100M
Mid Cap Growth Mid Cap Growth $10M / $75K
0.75% on the first $25M
0.60% on the next $25M
0.55% on the next $50M
0.50% on assets exceeding $100M
Focused Mid Cap
Growth Mid Cap Growth $10M / $85K
0.85% on the first $25M
0.70% on the next $25M
0.65% on the next $50M
0.55% on assets exceeding $100M
Small Cap Growth Small Cap
Growth $10M / $100K
1.00% on the first $10M
0.90% on the next $15M
0.80% on the next $25M
0.75% on the next $50M
0.70% on assets exceeding $100M
Munder Small-Cap/Mid
Cap Blend
Small/Mid Cap
Core $10M / $85K
0.85% on the first $10M
0.75% on the next $15M
0.70% on the next $25M
0.60% on the next $50M
0.50% on assets exceeding $100M
Integrity Asset
Management
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Integrity Mid Cap Value Mid Cap Value $5M / $42.5K
0.85% on the first $15M
0.75% on the next $35M
0.65% on the next $50M
0.60% on assets exceeding $100M
Integrity Small/Mid Cap
Value
Small/Mid Cap
Value $5M / $50K
1.00% on the first $15M
0.85% on the next $35M
0.80% on the next $50M
0.75% on assets exceeding $100M
Integrity Small Cap
Value Small Cap Value $10M / $100K
1.00% on the first $15M
0.90% on the next $35M
0.80% on the next $50M
Page | 11
0.75% on assets exceeding $100M
Integrity Discovery
Value Micro Cap Core $5M / $50K
1.00% on the first $15M
0.90% on the next $35M
0.80% on the next $50M
0.75% on assets exceeding $100M
International Equity
Expedition Investment
Partners Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Expedition International
Small Cap Equity
International
Small Cap $10M / $100K
1.00% on the first $25M
0.90% on the next $75M
0.85% on assets exceeding $100M
Expedition International
Small Mid Cap Equity
International
SMID Cap $10M / $95K
0.95% on the first $25M
0.85% on the next $75M
0.80% on assets exceeding $100M
Expedition International
Micro Cap Equity
International
Micro Cap $10M / $150K 1.50% on all assets
Expedition All Country
ex US Small Cap
Equity
ACWI ex US
Small Cap
Equity
$10M / $100K
0.90% on the first $25M
0.85% on the next $75M
0.80% on assets exceeding $100M
Expedition Emerging
Markets Small Cap
Equity
Emerging
Markets Small
Cap Equity
$25M / $275K
1.10% on the first $50M
1.00% on the next $50M
0.90% on assets exceeding $100M
RS Investments
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
RS International
Strategy
International All
Cap (non-US) $10M / $80K
0.80% on the first $30M
0.70% on the next $70M
0.60% on the next $150M
0.50% on assets exceeding $250M
RS Global Strategy Global All Cap
(Including US) $10M / $80K
0.80% on the first $30M
0.70% on the next $70M
0.60% on the next $150M
0.50% on assets exceeding $250M
Sophus Capital
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Sophus Emerging
Markets Strategy
Emerging
Markets All Cap $10M / $100K
1.00% on the first $30M
0.80% on the next $70M
0.70% on the next $150M
0.60% on assets exceeding $250M
Sophus Emerging
Markets Small Cap
Strategy
Emerging
Markets Small
Cap
$10M / $125K
1.25% on the first $30M
1.15% on the next $70M
1.05% on the next $150M
0.95% on assets exceeding $250M
Page | 12
Sophus China Strategy China All Cap $10M / $110K
1.10% on the first $30M
0.90% on the next $70M
0.75% on the next $150M
0.65% on assets exceeding $250M
Trivalent Investments
Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Emerging Markets
Small
Emerging
Markets Small
Cap Equity
$25M / $287.5K
1.15% on the first $50M
1.05% on the next $50M
1.00% on assets exceeding $100M
Trivalent International
Core Equity
International
Large Cap $10M / $80K
0.80% on the first $25M
0.70% on the next $25M
0.60% on the next $50M
0.40% on assets exceeding $100M
International ACWI International
Large Cap $10M / $80K
0.80% on the first $25M
0.70% on the next $25M
0.60% on the next $50M
0.40% on assets exceeding $100M
Trivalent International
Large Cap Select
Equity
International
Large Cap $10M / $80K
0.80% on the first $25M
0.70% on the next $25M
0.60% on the next $50M
0.40% on assets exceeding $100M
Trivalent International
Small-Cap Equity
International
Small Cap $10M / $95K 0.95% on the first $25M
0.85% on assets exceeding $25M
Fixed Income
INCORE Capital
Management Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Taxable and Tax-
Exempt
Enhanced Core
Fixed Income $10M / $25K
0.25% on the first $25M
0.20% on the next $25M
0.15% on the next $50M
0.10% on assets exceeding $100M
Mortgage Opportunities
Mortgage-
Backed
Securities
$10M / $40K
0.40% on the first $25M
0.35% on the next $25M
0.30% on the next $50M
0.25% on assets exceeding $100M
Short Govt. / Mortgage-
Backed Securities
Short Govt. /
Mortgage-
Backed
Securities
$20M / $70K
0.35% on the first $50M
0.30% on the next $50M
0.25% on assets exceeding $100M
Hybrid/Other
INCORE Capital
Management Strategy Style
Minimum Account
Size / Annual Fee
Standard Institutional Separate
Account Fee Schedule
Page | 13
Investment Grade
Convertible Securities
Investment
Grade
Convertible
Securities
$10M / $55K
0.55% on the first $25M
0.50% on the next $25M
0.45% on the next $50M
0.40% on assets exceeding $100M
Victory Capital receives payment for its investment advisory services in a number of ways,
which depends primarily upon product type or client preference. Generally, the methods
available are as follows:
Separate accounts:
Unless otherwise agreed upon with a client, separate accounts are charged quarterly
in arrears, based on month-end account values. Separate accounts that are initiated
or terminated during a calendar quarter are charged a prorated fee. In the event of
termination, any fees paid in advance are refunded on a pro-rata basis. Any
outstanding fees are charged on a pro-rata basis, according to the terms of the
investment advisory agreement.
Separate account clients receive quarterly statements from their “qualified
custodian,” as defined in Rule 206(4)-2 under the Advisers Act (the “qualified
custodian”). These statements list all transactions made in and fees charged to the
account.
o Institutional client accounts: Institutional clients may receive
and pay invoices directly to Victory Capital or they may choose
to receive invoices and authorize their qualified custodian to
submit payment to Victory Capital.
o High net worth client accounts: Victory Capital submits
invoices to the client’s qualified custodian, who is authorized to
remit payment to Victory Capital on behalf of the client. The
client must consent in advance to make direct debits to their
investment accounts. For sub-advisory services, the client’s
investment adviser calculates and remits sub-advisory fees to
Victory Capital.
Pooled vehicles:
o Mutual funds and ETFs: Fees are paid as provided in the
fund’s prospectus and statement of additional information.
Generally, fees are deducted daily through a reduction in the
fund’s Net Asset Value (NAV) and paid to Victory Capital
monthly in arrears.
o Collective trust funds: Clients may choose to pay advisory fees
directly from the assets of the fund or to be invoiced directly.
o Private funds: Fees are paid as provided in the private offering
documents.
Page | 14
o UCITS: Fees are paid as provided in the Victory UCITS
offering documents available on-line at
http://www.caroloncapital.com/UCITS-fund.html.
Wrap fee programs:
Fees for wrap fee programs—both UMA and SMA—are paid to
Victory Capital through the wrap sponsor. Fees vary and may be
charged either in advance or arrears, depending on the agreement
between Victory Capital and the wrap sponsor. SMA clients with dual
contracts (as discussed in Item 4) may receive and pay invoices
directly to Victory Capital or they may choose to receive invoices and
authorize their custodian to submit payment to Victory Capital.
PERFORMANCE BASED FEES
Certain separate accounts pay Victory Capital an advisory fee structured as a performance-
based fee which is a modification of the standard asset-based fee. This means that when a
client’s account underperforms relative to a specified benchmark Victory Capital’s fee is
reduced, and when a client’s account outperforms relative to the benchmark, Victory Capital’s
fee is increased. Performance for purposes of calculating the performance-based fee is
evaluated on a multi-year basis. Under certain circumstances, a client whose account is subject
to a performance-based fee may pay Victory Capital an increased fee, even though the
performance of both the account and the benchmark is negative, if the decline in the
performance of the benchmark is greater than the decline in the account’s net performance.
Separate accounts that pay Victory Capital an advisory fee structured as a performance-based
fee may at times pay a lower fee than a client with the same level of assets that pays fees
pursuant to an asset-based fee schedule.
Certain privately-offered pooled vehicles for which Victory Capital serves as the subadvisor
generally pay Victory Capital an asset-based fee or a combination of an asset-based fee and a
performance fee. The annual asset-based advisory fee rate is typically 1.00% of the pooled
vehicle’s assets. For private pooled vehicles that also pay a performance fee, Victory Capital is
paid a fee equal to a percentage (for example, 20%) of the vehicle’s return in excess of that of
its benchmark over a specified period or of the amount by which the net asset value of a unit of
the vehicle exceeds the highest net asset value used for calculation of a previous performance
fee. A description of the performance fee paid by a pooled vehicle is included in that vehicle’s
offering documents and this summary is qualified in its entirety by the description in the offering
documents.
Victory Capital typically bills performance fees, if applicable, in arrears on a quarterly or annual
basis.
Please see Item 6, “Performance-Based Fees and Side-by-Side Management,” for more
information regarding performance fees.
THIRD PARTY OR OTHER FEES
In addition to the advisory fee paid to Victory Capital, clients may directly or indirectly pay fees
to third parties associated with their accounts and investments. Such fees may include custody
fees or other fees. For example, clients with separately managed account select and negotiate
Page | 15
custody and transaction fees with their custodian. Brokerage fees are included in the price at
which equity trades are executed (for more information, please see Item 12 herein). Clients
may also incur trade execution or service charges, dealer mark-ups and mark-downs, charges
for odd-lot differentials, exchange fees, transfer taxes, electronic fund transfer fees, trust
custodial fees or any charges mandated by law.
Pooled vehicles, including the Victory Funds, pay interest expense, taxes, custodian fees and
charges, professional fees, administrative service fees and other charges incurred in connection
with the operation of their accounts. In addition, the Victory Funds pay other types of fees and
expenses, including, but not limited to, distribution fees, transfer agent fees, registration fees,
fees related to the preparation of shareholder reports, fees of the funds’ independent trustees,
and insurance expenses. Information regarding these fees and expenses is included in the
applicable prospectus and statement of additional information for the Victory Funds or other
offering document for other types of pooled vehicles.
Victory Capital may invest assets in a client’s separate account in unaffiliated pooled vehicles or
in the Victory Funds. Victory Capital may do this, for example, if a Victory Fund provides a more
efficient or cost-effective way to diversify the account into another asset class or to deploy cash.
When Victory Capital invests client’s separate account assets into pooled vehicles, the account
will incur charges or fees (in addition to those listed above for separate accounts) that are
disclosed in the offering documents associated with such investments. When Victory Capital
invests assets in a client’s separate account into the Victory Funds, it selects the most favorable
share class the client is eligible for. If Class A shares of a mutual fund are selected, such
investment will be made on a “no load” basis. “No load” means that shares may be purchased
or redeemed at any time without a sales commission or sales charge; however, accounts
remain subject to the advisory and any other fees that are charged to shareholders of such
funds, as set forth in each fund’s prospectus. If Victory Capital selects an ETF for a client
account, the account will incur brokerage commissions to buy or sell shares of that ETF on an
exchange.
Depending on the Victory Fund in which the separate account is invested, the fees associated
with that Fund (a portion of which are paid to Victory Capital) may be more than the advisory fee
that is otherwise applicable to the account. In such instances, it may present a conflict of
interest for Victory Capital because the investment advisory and administration fees it receives
from the applicable Victory Fund are greater than the advisory fees that are otherwise
applicable to the account. Further, Victory Capital has an incentive to recommend investments
in the Victory Funds rather than in unaffiliated funds because Victory Capital receives
investment advisory and administration fees from those affiliated funds but not from unaffiliated
funds.
Page | 16
ITEM 6: PERFORMANCE-BASED FEES AND SIDE-BY-SIDE MANAGEMENT
As described in Item 5, “Fees and Compensation,” Victory Capital receives performance-based
fees from certain clients. Because a performance fee is based on an account’s net
performance, including unrealized appreciation, it may create an incentive for Victory Capital to
cause the accounts that pay a performance-based fee to make investments that are riskier or
more speculative than would be the case in the absence of a fee based on the performance of
those accounts. In addition, Victory Capital may have a conflict of interest in allocating limited
opportunity investments between client accounts that pay a performance-based fee and clients
that do not pay a performance-based fee, if it perceives that it may receive more favorable
compensation with respect to the accounts that pay a performance-based fee.
To address these conflicts, Victory Capital has adopted policies and procedures and a Code of
Ethics that are designed to mitigate these conflicts of interest. The Victory Capital Code of
Ethics requires employees to place their clients’ interests ahead of their own (for more
information, see Item 11 herein).
Victory Capital follows procedures with respect to the allocation of investment opportunities
among its clients, including procedures with respect to the allocation of limited opportunities,
and regularly reviews trades for consistency with Victory Capital’s allocation procedures.
Victory Capital’s procedures do not permit performance-based fee arrangements to be taken
into consideration in connection with the allocation of investment opportunities. Pursuant to
these procedures, Victory Capital generally allocates investments pro rata based on the current
total net assets of each account, and any deviation from a pro rata allocation must follow Victory
Capital’s allocation policies and procedures (for more information, please see Item 12 herein).
In addition, Victory Capital uses a model portfolio as the basis of portfolio construction for
separate accounts in the same strategy so those accounts are treated the same, subject to
each client’s investment mandate. Performance-based fee and proprietary accounts are
included in the same composite as asset-based fee and non-proprietary accounts, which
facilitates comparison across account types for any dispersion of performance between
accounts with and without performance fees.
Page | 17
ITEM 7: TYPES OF CLIENTS
Victory Capital provides investment advisory or sub-advisory services to high net worth
individuals, institutional clients, and pooled vehicles. Institutional clients may include charitable
organizations, financial institutions (such as banks and insurance companies), pension or profit
sharing plans, corporations, Taft-Hartley plans, and sovereign wealth funds. Victory provides
advisor services to some high net worth individuals. Victory Capital’s pooled vehicle clients may
include investment companies (including the Victory Funds), ETFs, unit trusts, UCITS (including
the Victory UCITS) and collective investment trusts (including Victory Capital Collective
Investment Trust, and Victory Capital International Collective Investment Trust).
Victory Capital also provides advisory and sub-advisory services to UMA sponsors and SMA
clients in wrap fee programs (for additional information, see Item 4 herein). Victory Capital
provides sub-advisory services to private funds, but as of the date of this brochure, does not
directly advise its own private fund.
Please see Item 5 for information regarding minimum account sizes.
Page | 18
ITEM 8: METHODS OF ANALYSIS,
INVESTMENT STRATEGIES AND RISK OF LOSS
Investment Franchises
Victory Capital’s separate investment franchises have autonomy over their investment process,
strategies and portfolio decisions. Each team is supported by a common infrastructure
comprising trading, operations, compliance, sales, client service, and general business
management. Overall, these investment franchises manage a variety of domestic and
international equities, convertibles and fixed income strategies. Each strategy is intended to be
one of several components of a client’s overall asset allocation and is not intended to be a
complete investment program. Below is a summary of the investment strategies and
methodologies used by each franchise, together with a list the principal risks associated with
those strategies. A complete description of these risks is further below under “Glossary of
Risks.”
Any investment includes the risk of loss that clients should be prepared to bear and there can
be no guarantee that a particular level of return will be achieved. Clients and other investors
should understand that they could lose some or all of their investment and should be prepared
to bear the risk of such potential losses. They should read carefully all applicable offering or
governing documents.
CEMP
CEMP is the creator of the CEMP Volatility Weighted Indexes (each an “Index”), a family of
rules-based indices that combine fundamental criteria with individual security risk control
achieved through volatility weighting of individual securities. The Indexes cover all market
capitalizations of U.S, developed non-U.S. and emerging markets. CEMP also maintains
Indexes in alternative strategies, e.g. commodities. CEMP’s Index methodology is patent
pending (Application No. 61/645,370).
Each Index is rebalanced semi-annually, in March and September. In conjunction with each
rebalancing date, an Index’s rules are applied to its universe of publicly traded securities in
order to determine which securities are eligible for inclusion in the Index. New securities are
added to the Index only on rebalancing dates and only securities that comply with the CEMP
Index methodology are eligible to be included in an Index. Securities that no longer meet
eligibility for an Index on the rebalance date are omitted. Index maintenance occurs throughout
the year and includes monitoring and adjusting an Index for company additions and deletions,
stock splits, corporate restructurings and other corporate actions. Corporate actions are
generally implemented after the close of trading on the day prior to the ex-date of such
corporate actions. A security also may be removed from an Index in between rebalancing dates
if it no longer represents an investable asset due to legal constraints or other independent
factors. In response to market conditions that occur between rebalancing dates, an Index’s
country and sector weights may fluctuate above or below a specified cap between annual Index
screening dates.
Some of the CEMP Volatility Indexes are long-only indexes, while others employ a defensive
“Long/Cash” strategy, which is designed to reduce exposure to equities during periods when
markets are volatile. During periods of significant market decline, the Long/Cash CEMP Indexes
will reduce exposure to the equity markets by allocating as much as 75% of the Index to 30-day
Page | 19
Treasury bills during times when the stock markets are volatile and reinvest when market prices
have rebounded or have further declined.
Principal Investment Risks
Commodities Risk; Derivatives Risk; Emerging Markets Risk; Equity Securities Risk; Foreign
Securities Risk; Futures and Options Risk; Geographic Focus Risk; Liquidity Risk; Sampling
Risk; Small Companies Risk; Mid-Sized Companies Risk; Passive Investing Risk; Political Risk;
Tracking Error Risk; and Underlying Investment Vehicle Risk.
Diversified Equity Management (“Diversified”)
Diversified manages portfolios in long only, large-company stocks. It is style-agnostic and
benchmarked against the S&P 500 Index. Diversified invests predominately in securities of U.S.
companies, but may also invest in foreign companies through ADRs.
Diversified’s Equity Strategy results in a diversified portfolio of 40-60 holdings are monitored by
various risk controls that include portfolio construction limits (no more than 5% in any one
holding, for example) as well as quantitative methods that identify tracking error, the risk budget
(identifying factor vs. security-specific risks) and numerous other quantitative elements.
In selecting securities for the strategy, Diversified employs a combination “top-down/bottom up”
approach. A top-down approach considers the economic outlook, an assessment of the
business cycle, the interest rate outlook and the capital market outlook, and typically results in
tilting the portfolio towards cyclical or defensive stocks, high or low beta stocks, growth or value
stocks, and domestic or global companies. With a bottom-up analysis, Diversified conducts
fundamental research to identify mispriced or misunderstood securities. Areas of focus typically
include an analysis of the business model for a competitive advantage, a company’s capital
allocation history and outlook, an analysis of sentiment and investor expectations that are built
into the current stock price, a valuation analysis where the team identifies upside and downside
price objectives, and finally, the catalysts to make the stock a successful investment over the
strategy’s investment time horizon.
Principal Investment Risks
Equity Securities Risk; Foreign Securities Risk; Political Risk; Growth Securities Risk;
Management Risk; and Value Securities Risk.
Expedition Investment Partners (“Expedition”)
Expedition invests in securities, including common stocks, preferred stocks, or other securities
immediately convertible into common stock, issued by companies in developed (excluding the
United States), emerging and frontier market countries, excluding the United States.
Expedition’s investment strategies may include equity securities of micro-cap, small-cap and
small-/mid-cap companies.
Expedition believes that smaller companies are attractive because they are inefficiently priced,
under-researched and have limited institutional ownership. Internal research drives the
investment process, which focuses on gathering fundamental informat ion on potential
investments and taking a view on the strength of the business model and its growth prospects.
Page | 20
Expedition aims to produce portfolios of high quality and exceptionally dynamic small cap
companies, with a focus on those operating in industries that offer attractive investment
opportunities as a result of secular changes. Within these areas, Expedition seeks to find the
companies with the highest probability of achieving success through industry-leading proprietary
products and services, sustainable margins, and strong balance sheets. Valuation analysis is
used to determine whether the company’s stock is undervalued enough relative to its growth
prospects to provide meaningful upside, but is only conducted on companies that Expedition
determines to be strong and sustainable franchises. Although portfolio country and sector
weightings are the result of bottom-up stock selection, for the purposes of diversification and
risk control, a broad country and industry representation is sought in the portfolio.
Principal Investment Risks
Currency Risk; Derivatives Risk; Emerging Market Risk; Equity Securities Risk; Foreign
Securities Risk; Underlying Investment Vehicle Risk; Legal Risk; Liquidity Risk; Management
Risk; Mid-Sized Companies Risk Participation Note Risk; Political Risk; and Small Companies
Risk.
INCORE Capital Management (“INCORE”)
INCORE Convertibles
The INCORE All Qualities Convertible Strategy invests in domestic convertible securities
encompassing the entire quality spectrum. Despite the all qualities nature of this strategy, it
favors higher than average quality convertibles.
The INCORE Investment Grade Only Convertibles Strategy invests in domestic convertible
securities rated “investment-grade” by a nationally recognized statistical rating organization,
such as S&P, Moody’s or Fitch.
The INCORE Investment Grade Convertibles Strategy invests in a blend of domestic investment
grade convertible securities, high quality, unrated convertible securities and select lower grade
convertibles. Below investment-grade or unrated convertibles are generally limited to 20% of
the portfolio. The average quality of the portfolio is rated investment grade securities.
Convertible security selection involves analyzing the underlying stock to determine its
attractiveness. The convertible security’s credit profile and fixed income characteristics are
analyzed and then each issue’s specific convertible characteristics are assessed. Internal and
external research, as well as various quantitative reports, is used to analyze the underlying
stock. The INCORE Convertibles team seeks to identify stocks with long-term fundamental
prospects that are not yet reflected in the current price. The strategy’s investment team also
looks for catalysts to move the stock sooner, rather than later. Potential catalysts may include
rising earnings estimates, new product potential, or positive capital allocation decisions. Finally,
dedicated convertible systems are used to assess the unique characteristics of each issue to
determine its risk/reward profile, as well as any important convertible attributes.
Following the individual convertible evaluation, the INCORE Convertibles team invests in the
most attractive convertible securities to build diverse portfolios. The team takes a balanced
approach to portfolio construction by dividing the portfolio into thirds, with roughly a third of the
portfolio in equity-sensitive convertibles that provide upside participation, a third in defensive,
bond-like convertibles for downside protection, and a third in total return or middle-of-the-road
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convertibles that provide upside potential and downside protection. This balanced structure is
designed to lessen volatility and provide smooth performance over a market cycle.
Principal Investment Risks
Below Investment-Grade Securities Risk; Convertible Debt Securities Risk; Credit (or default)
Risk; Equity Securities Risk; Foreign Securities Risk; Inflation Risk; Interest Rate Risk;
Management Risk; Political Risk; Reinvestment Risk; and Synthetic Convertible Securities Risk.
INCORE Fixed Income
The INCORE fixed income strategies invest principally in fixed income securities that are rated
“investment grade” by a nationally recognized statistical rating org anization, such as S&P,
Moody’s or Fitch. The strategies invest for varying maturities and can include taxable and tax-
exempt securities.
The INCORE team believes that value can be added consistently by exploiting economic cycles
that create capital market inefficiencies and cyclical valuations that revert to the mean over time.
The INCORE team uses a macro world view based on a proprietary, multi-factor model that
broadly accounts for economic, valuation, and momentum factors. The results of this model are
used to help determine aggregate exposure to credit spreads versus government securities,
such as treasuries and agencies, and to identify opportunities among credit sectors, such as
corporate bonds and mortgage- and asset-backed securities. The model also helps determine
interest rate exposure and positioning on the yield curve. The INCORE team uses the model to
help make sector allocation, active duration, and yield curve positioning decisions.
The primary goal of the INCORE team’s credit research is to maximize total and risk adjusted
return. The INCORE investment team uses a proprietary, multi-factor credit screening process
to identify and own the debt of companies with stable or improving credit fundamentals and to
avoid the debt of companies with deteriorating credit fundamentals. Fundamental credit factors
include earnings, cash flow, profitability, balance sheet ratios, and Altman Z-scores. Additional
factors include valuation, liquidity, ratings pressure, and a forward probability of default, which
incorporates equity volatility. The screening process allows the INCORE team to cover a wide
universe of investable issuers and to focus quickly its efforts on issuers that meet its investment
criteria. The screening tool is the first step in the process, which is followed by a more thorough
investigation of stability, experience, reputation of the management team and understanding the
company’s business model and the sustainability of its cash flows. The INCORE team also
looks closely at ownership by activist shareholders who may be inclined to encourage actions
that favor equity holders over debt holders.
The INCORE strategies’ fixed income securities may include without limitation: U.S. government
securities, including securities issued by agencies or instrumentalities of the U.S. government;
long- and short-term corporate debt obligations; mortgage-backed securities, including
collateralized mortgage obligations (CMOs) and commercial mortgage-backed securities
(CMBS); asset-backed securities, including collateralized debt obligations (CDOs); and U.S.
dollar-denominated obligations of foreign governments, corporations and banks (i.e., Yankee
Bonds). The INCORE strategies may purchase or sell securities on a when-issued, to-be-
announced (TBA), delayed delivery or forward commitment basis and may engage in short-term
trading of portfolio securities. The INCORE strategies may also utilize dollar roll transactions to
obtain market exposure to certain types of securities, particularly mortgage-backed securities.
The INCORE strategies may enter into exchange traded or over -the-counter derivatives
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transactions of any kind, such as futures contracts (both long and short positions), options on
futures, and swap contracts, including, for example, interest rate swaps and credit default
swaps.
The INCORE team may invest in loans of any maturity and credit quality. If the strategy invests
in loans, the strategy’s investment team may seek to avoid the receipt of material non-public
information about the issuers of the loans being considered for purchase by the strategy, which
may affect its ability to assess the loans as compared to investors that do receive such
information.
Although the INCORE fixed income strategies will primarily be invested in domestic securities, a
portion may be invested in foreign securities, which may be denominated in foreign currencies.
The strategies may invest a portion of their total assets in below investment grade debt
securities, commonly known as “high-yield” securities or “junk bonds.”
Principal Investment Risks
Credit Derivatives Risk; Currency Risk; Debt Securities Risk; Derivatives Risk; Foreign
Securities Risk; Futures and Options Risk; High-Yield/Junk Bond Risk; Liquidity Risk; Loan
Risk; Management Risk; Mortgage- and Asset-backed Securities Risk; Mortgage Dollar Roll
Risk; Portfolio Turnover Risk and When-Issued, TBA & Delayed-Delivery Securities Risk.
INCORE Short Government
INCORE Short Government seeks to provide high, reliable income by investing in securities
backed 100% by the full faith and credit of the U.S. government. It primarily invests in securities
issued by the U.S. government and its agencies or instrumentalities. Under normal
circumstances, the strategy invests in mortgage-backed obligations and collateralized mortgage
obligations (CMOs) issued by the Government National Mortgage Association (GNMA), with an
average effective maturity ranging from 2 to 10 years and obligations issued or guaranteed by
the U.S. government or by its agencies or instrumentalities with a dollar-weighted average
maturity normally less than 5 years.
INCORE Short Government’s portfolio construction consists of three layers: (1) top-down,
macro-economic driven, (2) mid-level, relative value driven and (3) bottom up, borrower
characteristics driven. The greatest emphasis will generally be on the bottom up factor, but the
relative weightings of the three layers can and will vary over time, reflective of the broad
economic environment. The strategy may purchase or sell securities on a when-issued, to-be-
announced or delayed delivery basis. There is no limitation on the maturity of any specific
security, and the team may sell any security before it matures.
Principal Investment Risks
Mortgage- and Asset-backed Securities Risk; Extension Risk; Liquidity Risk; Inflation Risk;
Interest Rate Risk; Management Risk; Prepayment Risk; Reinvestment Risk; and When-Issued,
TBA & Delayed-Delivery Securities Risk.
Integrity Asset Management (“Integrity”)
Integrity strategies invest primarily in equity securities of micro-, small-, small-/mid- or mid-
capitalization companies. Integrity invests most of its assets in U.S. company securities, but
may also invest in foreign securities.
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Integrity focuses on stocks that are currently undervalued, yet poised to outperform. To identify
these stocks, the Integrity investment team’s disciplined process seeks two key elements:
prudent value and improving sentiment. Prudent value implies that a statistically cheap stock
that is trading below the team’s estimate of its intrinsic value will deliver strong total return over
time. The process also identifies catalysts that lead to improving investor sentiment. Ultimately,
the strategy seeks to invest in the right company at the right price at the right t ime.
Integrity specifically searches for companies with profitable reinvestment opportunities or a
willingness to return profits to shareholders. In addition, the team continuously evaluates
factors such as the company’s economic value added, capital allocation discipline, and the
impact of past management decisions. This is done to identify future opportunities or potential
problems that may affect shareholder return potential. Integrity analyzes stocks for two
elements with regards to valuation: statistical cheapness and intrinsic value. Valuation is
conducted both on a universe basis for the entire group of micro -cap value stocks as well as the
current portfolio and pipeline of new ideas. With regards to timing, the strategy’s investment
team applies continuous and rigorous fundamental analysis and searches for a catalyst to
indicate improving investor sentiment. Catalysts are typically company, industry, or
macroeconomic developments that may include a new management team that has potential or
a willingness to turn the company around, new product cycles, entrance into new markets or
gains in market share, and acquisitions or divestures that create value.
Principal Investment Risks
Equity Securities Risk; Financial Sector Risk; Focused Investment Risk; Foreign Securities Risk;
IPO Risk; Small Companies Risk; Management Risk; Mid-Sized Companies Risk; REIT Risk;
and Value Securities Risk.
Munder Capital Management (“Munder”)
Munder invests principally in equity securities of companies that span the market capitalization
spectrum. Its strategies may invest in small-, mid-, and large- capitalization companies or in a
blend of small-/mid- capitalization companies. Munder’s Focused Small-Mid Cap Strategy may
hold a relatively small number of holdings.
Munder typically invests in securities of U.S. companies but may also invest in foreign
securities. While Munder’s core strength is security selection, the team augments its bottom-up
portfolio construction with robust risk controls to help reduce volatility and moderate sector,
capitalization and style risk exposures and optimize risk-adjusted returns.
Munder employs both fundamental analysis and quantitative screening to identify potential
investment candidates that the team believes are high-quality and have the potential for above-
average earnings growth and improving business momentum. Investment candidates typically
exhibit some or all of the following key criteria: higher than average earnings growth;
consistency of earnings growth; valuation levels attractive relative to the market and the
company’s growth rate; below-average debt level and quality, measured by leadership position
in the company’s industry, proven operating earnings results and a highly regarded
management team. Purchase and sale decisions are based on Munder’s careful consideration
of the potential reward relative to risk of each security based on proprietary research (mosaic)
and financial modeling.
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Principal Investment Risks
Equity Securities Risk; Foreign Investments Risk; Growth Securities Risk; Limited Portfolio Risk;
Management Risk; Mid-Sized Companies Risk; Portfolio Turnover Risk; and Small Companies
Risk.
NewBridge Asset Management (“NewBridge”)
The NewBridge Large Cap Growth Strategy invests principally in equity securities of large
market capitalization companies that have growth prospects supported by strong financial
foundations, market leadership, and sound management teams. The strategy typically holds a
limited number of U.S. securities, but may also invest in foreign securities. NewBridge searches
for investment ideas across all sectors and industries, broadening the search for securities and
allowing the team to draw comparisons of growth characteristics throughout the investment
universe. The NewBridge team puts attractive ideas through fundamental analysis, leveraging
experience and knowledge in helping to build and validate a thesis for each potential investment
candidate. Ideas are then analyzed within the context of the portfolio’s risk profile and
standards for diversification as it relates to sector and industry, emerging versus established
growth, and cyclical versus secular growth.
The NewBridge Global Equity Strategy seeks long-term growth and capital appreciation by
investing in U.S. and foreign securities with solid growth prospects at attractive valuations. A
well-diversified portfolio is constructed of securities with exposures in various sectors within
developed and emerging countries. In evaluating investments for the strategy, NewBridge uses
a combined approach of fundamental research and quantitative methods. The strategy’s
investment team focuses on individual stock selection among a smaller subset of names
narrowed by quantitative tools that provide a consistent framework to review the investable
universe. Potential candidates for investment are generated by screening the investable
universe for companies with attractive growth, quality, value, and momentum characteristics by
using quantitative metrics. Through fundamental analysis, the list of potential constituents is
then narrowed to securities with the most compelling investment theses.
Principal Investment Risks
NewBridge Large Cap Growth Strategy: Equity Securities Risk; Foreign Securities Risk; Growth
Securities Risk; Limited Portfolio Risk and Management Risk.
NewBridge Global Equity Strategy: Currency Risk; Derivatives Risk; Emerging Market Risk;
Equity Securities Risk; Foreign Securities Risk; Legal Risk; Liquidity Risk; Management Risk;
Mid-Sized Companies Risk; and Political Risk.
RS Investments - Value Team (“RS Value”)
RS Value invests primarily in equity securities of small-, mid-, and large-capitalization
companies that it believes are undervalued. RS Value typically invests in equity securities of
U.S. companies but may also invest in foreign securities. The RS Large Cap Value, RS Mid
Cap Value, and RS Small Cap Value Strategies will likely hold a more limited number of
securities than many other strategies. The RS Concentrated All Cap Value Strategy is
concentrated and expects to hold a larger portion of its assets in a smaller number of issuers.
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In evaluating investments, RS Value conducts fundamental research to identify companies with
improving returns on invested capital. RS Value’s research efforts seek to identify the primary
economic and value drivers for each company. Research focuses on a company’s capital
deployment strategy, including decisions about capital expenditures, acquisitions, cost-saving
initiatives, and share repurchase/dividend plans, as the adviser seeks to understand how
returns on invested capital may improve over time. Valuation is considered an important part of
the process. RS Value seeks to invest in companies based on its assessment of risk (the
possibility of permanent capital impairment) and reward (the future value of the enterprise).
Principal Investment Risks
Cash Position Risk; Equity Securities Risk; Focused Investment Risk; Foreign Securities Risk;
Limited Portfolio Risk; Management Risk; Mid-Sized Companies Risk; Overweighting Risk;
Small Companies Risk; Portfolio Turnover Risk; Liquidity Risk; Value Securities Risk; and
Underweighting Risk.
RS Investments – Growth Team (“RS Growth”)
RS Growth invests primarily in equity securities of small-, mid-, and large-capitalization
companies. The RS Small Cap Growth, RS Mid Cap Growth, RS Small/Mid Cap Growth, and
RS Large Cap Growth Strategies typically invest in securities of U.S. companies but may also
invest in foreign securities. The RS Science and Technology Strategy invests primarily in equity
securities of science and/or technology companies and may invest in companies of any size.
The strategy typically invests in securities of U.S. companies but may also invest in foreign
securities. A particular company will be considered to be a science or technology company if
RS Growth determines that it applies scientific or technological developments or discoveries to
grow its business or increase its competitive advantage. Science and technology companies
may also include companies whose products, processes or services, in the opinion of RS
Growth, are being, or are expected to be, significantly benefited by the use or commercial
application of scientific or technological developments or discoveries.
RS Growth employs both fundamental analysis and quantitative screening in seeking to identify
companies it believes will produce sustainable earnings growth over a multi-year horizon.
Investment candidates typically exhibit some or all of the following key criteria: strong org anic
revenue growth, expanding margins and profitability, innovative products or services, defensible
competitive advantages, growing market share, and experienced management teams. Valuation
is an integral part of the investment process and purchase decisions are based on RS Growth’s
expectation of the potential reward relative to risk of each security based in part on its
proprietary earnings calculations.
Principal Investment Risks
RS Small Cap Growth, RS Mid Cap Growth, RS Small/Mid Cap Growth, and RS Large Cap
Growth Strategies: Cash Position Risk; Equity Securities Risk; Focused Investment Risk;
Foreign Securities Risk; Growth Securities Risk; Limited Portfolio Risk; Liquidity Risk;
Management Risk; Mid-Sized Companies Risk; Overweighting Risk; Portfolio Turnover Risk;
Small Companies Risk; and Underweighting Risk.
RS Science and Technology Strategy: Cash Position Risk; Equity Securities Risk; Foreign
Securities Risk; Growth Securities Risk; Liquidity Risk; Management Risk; Mid-Sized
Companies Risk; Overweighting Risk; Portfolio Turnover Risk; Science and Technology
Investment Risk; Small Companies Risk; and Underweighting Risk.
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RS Investments – Developed Markets Team (“RS Developed Markets”)
The RS Global Strategy primarily invests in securities issued by companies of any size
wherever they may be in the world. The Strategy will typically invest in companies located in at
least three different countries including the United States with 40% or more of its total assets in
securities of non-U.S. companies. The Strategy may invest any portion of its assets in
companies located in emerging markets.
The RS International Strategy invests in securities issued by (i) companies organized,
domiciled, or with a principal office outside of the United States, (ii) companies which primarily
trade in a market located outside of the United States, or (iii) companies which do a substantial
amount of business outside of the United States, which RS Developed considers to be
companies that derive at least 50% of their revenue or profits from business outside the United
States or have at least 50% of their sales or assets outside the United States.
Investments are not typically focused in a particular industry or country. A significant part of the
Strategy’s assets will normally be divided among continental Europe, the United Kingdom,
Japan, and Asia/Pacific region (including Australia and New Zealand). The Strategy may invest
any portion of its assets in companies located in emerging markets.
RS Developed Markets employs both fundamental analysis and a data-driven approach in
seeking to identify companies across the market capitalization spectrum that it believes can
sustain long-term growth. Valuation is also an integral part of the investment process. RS
Developed Markets seeks to identify companies that it believes possess strong earnings quality,
operational efficiency, sound management, favorable growth characteristics, attractive
valuations, and that enjoy favorable market sentiment. RS Developed Markets monitors
macroeconomic and political trends, as well as risk exposures, as part of the overall investment
process.
Principal Investment Risks
Cash Position Risk; Currency Risk; Equity Securities Risk; Foreign Securities Risk;
Management Risk; Emerging Market Risk; Liquidity Risk; Mid-Sized Companies Risk;
Overweighting Risk; Portfolio Turnover Risk; Small Companies Risk; and Underweighting Risk.
Sophus Capital (“Sophus”)
The Sophus China Strategy invests in securities of Chinese companies. The strategy may
invest in companies of any size. The strategy currently defines a “Chinese company” as a
company that (1) has securities that are traded primarily on any stock exchange in China or
Hong Kong; (2) the strategy’s investment team considers to derive 50% or more of its revenues
or profits from goods produced, services performed, or sales made in China or Hong Kong; (3)
is organized under the laws of, or has its principal office in, China or Hong Kong; or (4) the
strategy’s investment team determines has a majority of its physical assets located in China or
Hong Kong.
The Sophus Emerging Markets Strategy invests in securities of emerging market companies of
any size and the Sophus Emerging Markets Small Cap Strategy invests in securities issued by
small-capitalization emerging market companies. An emerging market country is generally
defined as one that is included in the MSCI emerging market indices or the MSCI frontier market
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indices, or whose economy or markets are classified by the International Finance Corporation
and the World Bank to be emerging or developing, as well as any country classified by the
United Nations as developing or any country that has economies, industries, and stock markets
with similar characteristics. An emerging market company is generally defined as a company (1)
that is organized under the laws of, or has its principal office in, an emerging market country; (2)
that derives 50% or more of its revenue from goods produced, services performed, or sales
made in emerging market countries; or (3) for which the principal securities market is located in
an emerging market country.
Sophus employs both fundamental analysis and quantitative screening in seeking to identify
companies that it believes can sustain above-average earnings growth relative to their peers.
Valuation is an integral part of the process. Fundamental, bottom-up research focuses on
companies that rank highly within the quantitative screen, with particular emphasis placed on a
company’s earnings growth, business strategy, value creation, competitive position,
management quality, market position, and political and economic backdrop. Sophus monitors
market and sovereign risk as part of the overall investment process.
Principal Investment Risks
Equity Securities Risk; Foreign Securities Risk; Management Risk; Cash Position Risk; China
Risk; Currency Risk; Emerging Market Risk; Liquidity Risk; Mid-sized Companies Risk;
Overweighting Risk; Portfolio Turnover Risk; Small Companies Risk; and Underweighting Risk.
Sycamore Capital (“Sycamore”)
Sycamore invests principally in equity securities of small- capitalization and/or mid-capitalization
companies, primarily in securities of U.S. companies but may also invest in foreign companies
through the use of American Depository Receipts (ADRs).
Sycamore employs a bottom-up, fundamental investment approach to build a diversified
portfolio of mid-cap companies that it believes are undervalued and offer an asymmetrical
risk/reward profile. In building portfolios, Sycamore identifies companies that it believes to
possess each of the following attributes: better business with a sustainable model and above-
average financial strength; a dislocation in value between the current market price and the
team’s estimate of intrinsic value and fundamental drivers that will narrow the valuation gap.
Sycamore believes that companies that possess all three attributes offer the greatest downside
protection without sacrificing the upside potential. By adhering to a disciplined process, the
strategy’s objective is to deliver attractive returns with lower risk and volatility over the long-
term.
Principal Investment Risks
Equity Securities Risk; Foreign Securities Risk; Political Risk; Management Risk; Mid -Sized
Companies Risk; Small Companies Risk and Value Securities Risk.
Trivalent Investments (“Trivalent”)
The Trivalent International Small Cap Equity Strategy seeks to provide long -term growth of
capital by investing primarily in equity securities of companies in countries represented in the
S&P Developed ex-US Small Cap Index.
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The Trivalent International Core Equity Strategy seeks to provide long -term growth of capital by
investing primarily in equity securities of companies in countries represented in the MSCI EAFE
Index.
The Trivalent International ACWI-ex US Equity Strategy seeks to provide long-term growth of
capital by investing primarily in equity securities of companies in countries represented in the
MSCI ACWI (All Country World Index) ex USA Index, but may also invest in companies from
other countries. There is no limit on the market capitalization in which the strategy may invest;
therefore, equity investments may include small, mid- and large market capitalization
companies.
The Trivalent Emerging Markets Equity Strategy team seeks to provide long-term growth of
capital by investing primarily in equity securities of companies in countries represented in the
MSCI Emerging Markets Index.
The Trivalent Emerging Markets Small Cap Equity Strategy seeks to provide long -term growth
of capital by investing primarily in equity securities of companies in countries represented in the
S&P Emerging Plus Small Cap Index.
The Trivalent International Select Equity Strategy seeks to provide long-term growth of capital
by investing primarily in equity securities of companies in countries represented in the MSCI
ACWI (All Country World Index) ex USA Index, but may also invest in companies from other
countries. There is no limit on the market capitalization in which the strategy may invest;
therefore, equity investments may include small, mid- and large market capitalization
companies. The select portfolio will typically hold 60 to 80 stocks.
Trivalent selects stocks by using a blend of fundamental research and quantitative analysis,
focusing on quality companies that exhibit positive business momentum and favorable
valuations relative to peers. The stock selection process is designed to produce a diversified
portfolio that, relative to the applicable index, tends to have a below-average price-to-earnings
ratio, an above-average return on invested capital and an above-average earnings growth trend.
Trivalent’s risk controls are designed to reduce unintended risks while highlighting security
selection as a key part of the portfolio construction process. As a result, Trivalent’s investment
allocation to countries and sectors tends to closely approximate the country and sector
allocations of the applicable index.
Principal Investment Risks
Derivatives Risk; Emerging Markets Risk; Equity Securities Risk; Foreign Securities Risk;
Futures and Options Risk; Geographic Focus Risk; Growth Securities Risk; Liquidity Risk; Small
Companies Risk; Management Risk; Mid-Sized Companies Risk; and Political Risk; Portfolio
Turnover Risk; and Value Securities Risk
Glossary of Risks
Below Investment-Grade Securities Risk
Below-investment-grade securities (“junk bonds” or high-yield bonds) are subject to certain risks
in addition to those risks associated with higher-rated securities. Below-investment-grade
securities may be more susceptible to real or perceived adverse economic conditions, which
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may cause them to be downgraded or default, less liquid, and more difficult to evaluate than
investment-grade securities. Their values can decline significantly over short periods of time.
Cash Position Risk
Holding cash or cash equivalents, even strategically, may lead to missed investment
opportunities. This is particularly true when the market for other investments in which a strategy
may invest is rapidly rising. This could compromise the ability of the strategy to achieve its
investment objective.
China Risk
Investments in the China region are subject to special risks, such as less developed or less
efficient trading markets, currency fluctuations or blockage, nationalization of assets, limits on
repatriation, and the effects of governmental control of markets. The Chinese economy and
financial markets have experienced high levels of growth in recent years; any actual or
perceived reduction or curtailment in those levels of growth in the future would likely have a
substantial adverse impact on the values of Chinese companies. Investments in securities of
Chinese companies are subject to China’s heavy dependence on exports. A small number of
companies and industries represent a relatively large portion of the Chinese market as a whole.
Monsoons and other natural disasters may cause substantial adverse economic effects.
Commodities Risk
Commodity-related risks include production risks caused by unfavorable weather, animal and
plant disease, geologic and environmental factors. Commodity-related risks also include
unfavorable changes in government regulation such as tariffs, embargoes or burdensome
production rules and restrictions.
Convertible Debt Securities Risk
Convertible debt securities risk is the risk that the values of convertible debt in which a strategy
may invest may be affected by market interest rates, reduction in credit quality or credit ratings,
issuer default on interest and principal payments, and declines in the value of the underlying
common stock. Additionally, an issuer may retain the right to buy back its convertible securities
at a time and price unfavorable to the strategy.
Credit (or default) Risk
Credit (or default) risk is the risk that the issuer of a debt security will be unable to make timely
payments of interest or principal. Credit risk is measured by nationally recognized statistical
rating organizations, such as Standard & Poor’s, Fitch, Inc., and Moody’s Investor Service.
Credit Derivatives Risk
A strategy may enter into credit derivatives, including credit default swaps and credit default
index investments. A strategy may use these investments (i) as alternatives to direct long or
short investment in a particular security, (ii) to adjust a strategy’s asset allocation or risk
exposure, or (iii) for hedging purposes. The use by a strategy of credit default swaps may have
the effect of creating a short position in a security. These investments can create investment
leverage and may create additional investment risks that may subject a strategy to greater
volatility than investments in more traditional securities.
Currency Risk
The value of foreign securities denominated in foreign currencies may be affected favorably or
unfavorably by currency exchange rates, currency exchange control regulations, and restrictions
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or prohibitions on the repatriation of foreign currencies. To attempt to protect against changes
in exchange rates, a strategy may, but will not necessarily, engage in forward foreign-currency
exchange transactions, which may eliminate some or all of the benefit of an increase in the
value of a foreign currency versus the U.S. dollar.
Debt Securities Risk
The value of a debt security or other income-producing security changes in response to various
factors, including, by way of example, market-related factors (such as changes in interest rates
or changes in the risk appetite of investors generally) and changes in the actual or perceived
ability of the issuer (or of issuers generally) to meet its (or their) obligations.
Derivatives Risk
Derivatives transactions can create investment leverage and may be highly volatile. It is
possible that a derivative transaction will result in a loss greater than the principal a mount
invested, and a strategy may not be able to close out a derivative transaction at a favorable time
or price. The counterparty to a derivatives contract may be unable or unwilling to make timely
settlement payments, return the strategy’s margin, or otherwise honor its obligations.
Emerging Markets Risk
All of the risks associated with investing in foreign securities are increased in connection with
investments in securities associated with emerging markets. Countries in these markets are
more likely to experience high levels of inflation, deflation or currency devaluation, which could
also hurt their economies and securities markets. The risks of investing in these markets also
include the risks of illiquidity, increased price volatility, less government regulation, less
extensive and less frequent accounting, financial and other reporting requirements, risk of loss
resulting from problems in share registration and custody, and the nationalization of foreign
deposits or assets. In addition, countries in emerging markets are more likely to experience
instability in their markets due to social and political changes.
Equity Securities Risk
The value of a company’s stock may decline in response to factors affecting that particular
company or stock markets generally.
Extension Risk
Extension risk is the risk that the rate of anticipated prepayments on principal may not occur,
typically because of a rise in interest rates, and the expected maturity of the security will
increase. During periods of rapidly rising interest rates, the effective average maturity of a
security may be extended past what the investment team anticipated that it would be. The
market value of securities with longer maturities tends to be more volatile.
Financial Sector Risk
The values of companies in the financials sector are particularly vulnerable to economic
downturns and changes in government regulation and interest rates.
Focused Investment Risk
Focusing investments in a particular market or economic sector (which may include issuers in a
number of different industries) increases the risk of loss because the stocks of many or all of the
companies in the market or sector may decline in value to developments adversely affecting the
market or sector.
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Foreign Securities Risk
Foreign securities including ADRs and other depositary receipts are subject to political,
regulatory, and economic risks not present in domestic investments. Foreign securities
generally experience more volatility than their domestic counterparts and could be affected by
factors not present in the U.S., including expropriation, confiscation of property, and difficulties
in enforcing contracts. Compared to U.S. companies, there generally is less publicly available
information about foreign companies and there may be less governmental regulation and
supervision of foreign companies. In addition, to the extent that investments are made in a
limited number of countries, events in those countries will have a more significant impact on a
strategy.
Futures and Options Risk
A hedge created using futures or options contracts (or any derivative) does not, in fact, respond
to economic or market conditions in the manner the investment team expected. The contract
hedge may not generate gains sufficient to offset losses and may actually generate losses.
There is no assurance that a strategy will engage in any hedging transactions. Futures
contracts and options can also be used as a substitute for the securities to which they relate.
Other risks of investing in futures and options involves the risk that a strategy will be unable to
sell the derivative because of an illiquid secondary market; the risk the counterparty is unwilling
or unable to meet its obligation; and the risk that the derivative transaction could expose the
strategy to the effects of leverage, which could increase the strategy’s expos ure to the market
and magnify potential losses.
Geographic Focus Risk
A strategy may invest a substantial portion of its assets within one or more countries or
geographic regions. When a strategy focuses its investments in a country or countries, it is
particularly susceptible to the impact of market, economic, political, regulatory and other factors
affecting those countries. Additionally, a strategy’s performance may be more volatile when the
strategy’s investments are focused in a country or countries.
Growth Securities Risk
Growth securities might be more sensitive to changes in current or expected earnings than the
values of other stocks. Growth securities may be more volatile than other stocks, causing
greater fluctuations in value. A growth approach could also be impacted if the company does
not realize its anticipated potential or if there is a shift in the market to favor other types of
securities.
Inflation Risk
Inflation risk is the risk that inflation will erode the purchasing power of the cash flows generated
by debt securities held by a strategy. Fixed-rate debt securities are more susceptible to this risk
than floating-rate debt securities or equity securities that have a record of dividend growth.
Interest Rate Risk
Interest rate risk is the risk that the value of a security will decline if interest rates rise. When
interest rates go up, the value of a debt security typically goes down. When interest rates go
down the value of a debt security typically goes up. Generally, the market values of securities
with longer maturities are more sensitive to changes in interest rates. In addition, during periods
of increased market volatility, the market values of fixed income securities may be more
sensitive to changes in interest rates. Interest rates may rise or the rate of inflation may
increase, impacting the value of investments in fixed income securities. A debt issuer’s credit
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quality may be downgraded or an issuer may default. Interest rates may fluctuate due to
changes in governmental fiscal policy initiatives and resulting market reaction to those
initiatives.
IPO Risk
Investments in IPOs may result in increased transaction costs and expenses and the realization
of short-term capital gains and distributions. In addition, in the period immediately following an
IPO, investments may be subject to more extreme price volatility than that of other equity
investments. A strategy may lose all or part of its investments if the companies making their
IPOs fail and their product lines fail to achieve an adequate level of market recognition or
acceptance.
Legal Risk
Legal remedies for investors in foreign countries may be more limited than the legal remedies
available in the U.S.
Limited Portfolio Risk
To the extent a strategy invests its assets in a limited number of issuers than many other
strategies, a decline in the market value of a particular security held by the strategy may affect
its value more than if it invested in a larger number of issuers.
Liquidity Risk
Lack of a ready market or restrictions on resale may limit the ability of a strategy to sell a
security at an advantageous time or price. Adverse market or economic conditions may
adversely affect the liquidity of a strategy’s investments. In addition, a strategy, by itself or
together with other accounts managed by its adviser or sub-adviser, as the case may be, may
hold a position in a security that is large relative to the typical trading volume for that security,
which can make it difficult for the strategy to dispose of the position at an advantageous time or
price.
Loan Risk
Investments in loans are generally subject to the same risks as investments in other types of
debt securities, including, in many cases, investments in below investment-grade bonds. They
may be difficult to value and may be illiquid. If a strategy holds a loan through another financial
institution, or relies on a financial institution to administer the loan, its receipt of principal and
interest on the loan may be subject to the credit risk of that fin ancial institution. It is possible
that any collateral securing a loan may be insufficient or unavailable to the strategy, and that a
strategy’s rights to collateral may be limited by bankruptcy or insolvency laws. There may be
limited public information available regarding the loan. Transactions in loans may settle on a
delayed basis, and the strategy may not receive the proceeds from the sale of a loan for a
substantial period of time after the sale.
Management Risk
An investment team’s investment process may produce incorrect judgments about the value of
a particular asset and may not produce the desired results.
Mid-Sized Companies Risk
Mid-sized companies often have more limited managerial and financial resources than larger,
more established companies and, therefore, may be more susceptible to market downturns or
changing economic conditions. Prices of mid-sized companies tend to be more volatile than
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those of larger companies and small issuers may be subject to greater degrees of changes in
their earnings and prospects. Since mid-sized company stocks typically have narrower markets
and are traded in lower volumes than larger company stocks, they are often more difficult to sell.
Mortgage- and Asset-Backed Securities Risk
During periods of falling interest rates, mortgage- and asset-backed securities may be called or
prepaid, which may result in a strategy having to reinvest proceeds in other investments at a
lower interest rate. During periods of rising interest rates, the average life of mortga ge- and
asset-backed securities may extend, which may lock in a below-market interest rate, increase
the security’s duration, and reduce the value of the security. Enforcing rights against the
underlying assets or collateral may be difficult, or the underlying assets or collateral may be
insufficient if the issuer defaults.
Mortgage Dollar Roll Risk
The use of dollar rolls can increase the volatility of a strategy’s investments, and it may
adversely impact performance unless the investment team correctly predicts mortgage
prepayments and interest rates. Since the counterparty in the transaction is required to deliver
a similar, but not identical, security, the security that the strategy is required to buy under the
dollar roll may be worth less than an identical security. The use of cash received from a dollar
roll may not provide a return that exceeds the borrowing costs. In addition, investment in
mortgage dollar rolls may significantly increase a strategy’s portfolio turnover rate, which can
increase the strategy’s expenses and decrease returns.
Overweighting Risk
Overweighting investments in an industry or group of industries relative to a strategy’s
benchmark increases the risk that the strategy will underperform its benchmark because a
general decline in the prices of stocks in that industry or group of industries will affect the
strategy to a greater extent than its benchmark.
Participation Note Risk
Investing in participation notes involves the same risks associated with a direct investment in
the shares of the companies the notes seek to replicate. However, the performance results of
participation notes will not replicate exactly the performance of the issuers or markets that the
notes seek to replicate due to transaction costs and other expenses. In addition, participation
notes are subject to counterparty risks. Participation notes may be considered illiquid.
Passive Investment Risk
For passively managed index strategies, portfolio managers do not buy or sell shares of a
security based on current or projected performance of a security, industry or sector unless that
security is added to or removed from the index in accordance with the investment franchise’s
methodology. A strategy designed to track an index is not actively managed and does not,
therefore, seek returns in excess of the index. An index strategy may not be able to effectively
track the performance of its index.
Political Risk
Foreign securities markets may be more volatile than their counterparts in the U.S. Investments
in foreign countries could be affected by factors not present in the U.S., including expropriation,
confiscation of property, and difficulties in enforcing contracts. Foreign settlement procedures
may also involve additional risks.
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Portfolio Turnover Risk
Portfolio turnover generally involves a number of direct and indirect costs and expenses,
including, for example, dealer mark-ups and bid/asked spreads and transaction costs on the
sale of securities and reinvestment in other securities. Such costs have the effect of reducing
investment return. Such sales may result in the realization of taxable capital gains, including
short-term capital gains, which are generally taxed at ordinary income tax rates.
Prepayment Risk
Because prepayments generally occur when interest rates are falling, a strategy may have to
reinvest the proceeds from prepayments at lower interest rates. Interest rate levels and other
factors may affect the frequency of mortgage prepayments, which in turn can affect the average
life a pool of mortgage-related securities. In periods of falling interest rates, the prepayment
rate tends to increase, shortening the average life of a pool of mortgage-related securities.
Reinvestment Risk
Reinvestment risk is the risk that when interest rates are declining, the interest income and
prepayments on a security the strategy receives will have to be reinvested at lower interest
rates. Generally, interest rate risk and reinvestment risk tend to have offsetting effects, though
not necessarily of the same magnitude.
REIT Risk
Investing in real estate investment trusts (“REITs”) involves many of the risks of investing
directly in real estate such as declining real estate values, changing economic conditions and
increasing interest rates. REITs can entail additional risks because REITs depend on
specialized management skills, may invest in a limited number of properties and may
concentrate in a particular region or property type.
Sampling Risk
A passively managed strategy may use a representative sampling approach, which could result
in its holding a smaller number of securities than are in the index. As a result, an adverse
development with an issuer of securities held by the strategy could result in a greater decline in
NAV than would be the case if it held all of the securities of the Index.
Science and Technology Investment Risk
Investments in science and technology companies may be highly volatile. Their values may be
adversely affected by such factors as, for example, rapid technological change, changes in
management personnel, changes in the competitive environment, and changes in investor
sentiment. Many science and technology companies are small or mid-sized companies and
may be newly organized.
Small Companies Risk
Small companies often have more limited managerial and financial resources than larger, more
established companies and, therefore, may be more susceptible to market downturns or
changing economic conditions. Prices of small companies tend to be more volatile than those
of larger companies and small issuers may be subject to greater degrees of changes in their
earnings and prospects. Since small company stocks typically have narrower markets and are
traded in lower volumes than larger company stocks, they are often more difficult to sell.
Synthetic Securities Risk
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Synthetic convertible securities risk is the risk that the value of a synthetic convertible security
will respond differently to market fluctuations than a convertible security because a synthetic
convertible security is composed of two or more separate securities, each with its own market
value. Additionally, if the value of the underlying common stock or the level of the index
involved in the convertible security falls below the exercise price of the warrant or option, the
warrant or option may lose all value. Synthetic convertible securities are also subject to
counterparty risk.
Tracking Risk
The return of a passively managed strategy may not match the return of the index for a number
of reasons, including: the strategy incurs operating expenses not applicable to the index, and
incurs costs in buying and selling securities; the strategy may not be fully invested at times;
differences in the valuation of securities and differences between the strategy’s portfolio and the
index resulting from legal restrictions, cost or liquidity constraints.
Underlying Investment Vehicle Risk
An investment company or similar vehicle (including an ETF) in which a strategy invests may
not achieve its investment objective. Underlying investment vehicles are subject to investment
advisory and other expenses, which will be indirectly paid by the strategy.
Underweighting Risk
If a strategy underweights its investment in an industry or group of industries relative to its
benchmark, the strategy will participate in any general increase in the value of companies in that
industry or group of industries to a lesser extent than the benchmark.
Value Securities Risk
A value stock’s intrinsic value many never be fully recognized by the market or its price may
decline. Value stocks may fall out of favor with investors and may underperform growth stocks
in an up market.
When-issued, TBA and Delayed-Delivery Securities Risk
The market value of the security issued on a when-issued, TBA or delayed-delivery basis may
change before delivery date. There is also the risk that a party fails to deliver the security on
time or at all.
***********************************
Certain Risks Associated with Cybersecurity. Investment advisers such as Victory Capital must
rely in part on digital and network technologies to maintain substantial computerized data about
activities for client accounts and otherwise conduct their businesses. Like all businesses that
use computerized data, Victory Capital and the cyber networks it uses might in some
circumstances be subject to a variety of possible cybersecurity incidents or similar events that
could potentially result in the inadvertent disclosure of confidential computerized data or client
data to unintended parties, or the intentional misappropriation or destruction of data by
malicious hackers mounting an attack on computer systems. Victory Capital maintains an
information technology security policy and certain technical and physical safeguards intended to
protect the confidentiality of its internal data, and takes other reasonable precautions to limit the
potential for cybersecurity incidents, and to protect data from inadvertent disclosure or wrongful
misappropriation or destruction. Nevertheless, despite reasonable precautions, the risk remains
that cybersecurity incidents could potentially occur, might in some circumstances result in
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unauthorized access to sensitive information about Victory Capital or its clients, and might
cause damage to client accounts or Victory Capital’s activities for clients.
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ITEM 9: DISCIPLINARY INFORMATION
Victory Capital has not been subject to any legal or disciplinary events that it believes are
material to a client’s or prospective client’s evaluation of its business or the integrity of its
management.
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ITEM 10: OTHER FINANCIAL INDUSTRY ACTIVITIES AND AFFILIATIONS
BROKER-DEALER
Victory Capital is not a registered broker-dealer; however, some of Victory Capital’s
management persons are registered with the Financial Industry Regulatory Authority, Inc.
(“FINRA”) as representatives of Victory Capital Advisers, Inc. (“VCA”), an affiliate of Victory
Capital and a limited purpose broker-dealer and distributor of the Victory Funds.
FUTURES COMMISSION MERCHANT, COMMODITY POOL OPERATOR, OR COMMODITY
TRADING ADVISOR
Victory Capital is registered with the U.S. Commodity Futures Trading Commission (the “CFTC”)
as a commodity pool operator. Victory Capital is not registered or in the process of registering
as a commodity trading adviser with the CFTC. In addition, Victory Capital has several
employees who are registered with the National Futures Association (“NFA”) as Principals or
Associated Persons (as defined by the NFA).
MATERIAL RELATIONSHIPS OR ARRANGEMENTS WITH CERTAIN RELATED PERSONS
VCA is an affiliated, limited purpose broker-dealer that is the distributor for the Victory Funds.
Victory Capital does not execute any securities trades on behalf of client accounts through VCA.
Victory Capital provides continuous investment management services to the Victory Funds. As
discussed previously, a conflict of interest may occur if Victory Capital is incentivized to invest
client assets in the Victory Funds. Although Victory Capital does not believe that its relationship
with the Victory Funds creates any material conflicts of interest, it recognizes potential exists for
such conflict. Consequently, Victory Capital and the Victory Funds have policies and
procedures that are designed to identify and prevent such conflicts. Victory Capital’s Legal,
Compliance and Risk department regularly monitors for compliance with those policies and
procedures (for more information, see Item 11 herein).
OTHER INVESTMENT ADVISERS
RS Investments (UK) Limited, RS Investment Management (Singapore) Pte. Ltd., and RS
Investments (Hong Kong) Limited, wholly-owned subsidiaries of Victory Capital, are non-U.S.
investment advisers (“Non-U.S. Advisers”). In rendering investment advisory services to its
clients, including mutual funds, Victory Capital uses the resources of the Non-U.S. Advisers to
provide discretionary or non-discretionary investment advice, research, analysis, or such other
investment-related activities as Victory Capital may request or instruct from time to time. Each
of the Non-U.S. Advisers is a “Participating Affiliate” of Victory Capital as that term is used in
relief granted by the staff of the SEC allowing U.S. registered advisers to use investment
advisory and trading resources of unregistered advisory affiliates subject to the regulatory
supervision of the registered adviser. Each Participating Affiliate and any of its respective
employees who assist Victory Capital as described above is considered to be an “associated
person” of Victory Capital as that term is defined in the Advisers Act for purposes of Victory
Capital’s required supervision. The Participating Affiliates have agreed to submit to the
jurisdiction of the SEC and to the jurisdiction of the U.S. courts for actions arising under the U.S.
securities laws in connection with the investment advisory services they provide for any Victory
Capital clients. Please see Appendix A for the names and biographical information of the
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employees from each Participating Affiliate who is deemed to be an “associated person” of
Victory Capital.
Victory Capital owns a minority interest in Cerebellum Capital, LLC, the parent company of
Cerebellum GP, LLC (“Cerebellum”), a registered investment adviser that acts as the sole
general partner and provides investment advisory services to pooled investment vehicles
structured as limited partnerships (the “Cerebellum Funds”). Cerebellum may also have
different types of clients, including separate accounts. In connection with its investment in
Cerebellum, Victory Capital’s CEO joined as a member of the Cerebellum Board of Directors.
Victory Capital assists Cerebellum with marketing, sales and distribution activities and may also
utilize Cerebellum’s machine learning capabilities. While Victory Capital does not typically
recommend other investment advisers to its clients, Victory Capital and its related persons may
recommend that clients engage Cerebellum as an investment adviser or invest in the
Cerebellum Funds. Further, Victory Capital may have discretionary authority to cause clients to
invest in the Cerebellum Funds. As a result of Victory Capital’s investment in Cerebellum
Capital, LLC, Victory Capital and its related persons may be directly or indirectly benefitted by
the engagement of Cerebellum by clients or investments by clients in the Cerebellum Funds.
Victory Capital and its related persons also may have material ownership interests in the
Cerebellum Funds and may benefit as a result of investments in the Cerebellum Funds made by
Victory Capital clients. Victory Capital and its related persons may invest in the Cerebellum
Funds on terms different from, and more favorable than, those available to Victory Capital
clients. To address these conflicts, Victory Capital has adopted a Code of Ethics that is
designed to mitigate these conflicts of interest. The Victory Capital Code of Ethics requires
employees to place their clients’ interests ahead of their own (for more information, see Item 11
herein).
Victory Capital does not typically recommend other investment advisers to its clients. Victory
Capital engages other investment advisors to perform sub-advisory services for certain Victory
Funds. For example, KPB Investment Advisors, LLC is the sub-adviser to Victory Ohio
Municipal Bond Fund and Victory National Municipal Bond; Park Avenue Institutional Advisers
LLC is the sub-adviser to Victory High Yield Fund, Victory High Yield VIP Series, Victory Tax-
Exempt Fund, Victory High Income Municipal Bond Fund, Victory Floating Rate Fund, and
Victory Strategic Income Fund; and SailingStone Capital Partners LLC is the sub-adviser to
Victory Global Natural Resources Fund.
PROPRIETARY ACCOUNTS
Potential conflicts of interest are raised when Victory Capital manages accounts in which Victory
Capital and its employees own collectively 25% or more of the account (“proprietary
accounts”). When making investment decisions and in allocating investment opportunities,
Victory Capital may have an incentive to favor proprietary accounts over other client accounts in
trade execution or investment allocation. At times, Victory Capital or its employees may provide
the initial seed capital to fund new products or funds; thus, the aforementioned incentive could
exist when employees hold a personal interest in certain products or funds.
Victory Capital has adopted policies and procedures and a Code of Ethics that are designed to
mitigate these conflicts of interest. The Victory Capital Code of Ethics requires employees to
place their clients’ interests ahead of their own (for more information, see Item 11 herein).
These potential conflicts are also addressed in the trade aggregation and allocation policies and
procedures (for more information, please see Item 12 herein). Victory Capital’s procedures do
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not permit ownership of the account to be taken into consideration in connection with the
allocation of investment opportunities. Victory Capital regularly reviews trades for consistency
with Victory Capital’s allocation procedures.
PROPRIETARY INDEXES
Through its CEMP investment franchise, Victory Capital creates and maintains the CEMP
Indexes. To the extent mutual funds, ETFs or other products seek to track the performance of
any of the CEMP Indexes, there is a potential for conflicts of interests. However, Victory Capital
believes it has adopted policies and procedures to help protect against these conflicts, including
implementing information barriers and documentation of index changes as well as restrictions
on personal trading. In addition, Victory Capital has engaged an independent third-party to
calculate and publish the indexes.
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ITEM 11: CODE OF ETHICS, PARTICIPATION OR INTEREST IN CLIENT TRANSACTIONS
AND PERSONAL TRADING
Victory Capital has adopted the Victory Capital Code of Ethics (the “Code”) pursuant to Rule
204A-1 under the Advisers Act and Rule 17j-1 under the 1940 Act. The Code is designed to
ensure that Victory Capital employees comply with applicable federal securities laws and place
the interests of clients first in conducting personal securities transactions. The Code imposes
certain restrictions on securities transactions in the personal accounts of employees to help to
limit the effect of any conflicts of interest that may exist between Victory Capital’s clients and
Victory Capital employees. A copy of the Code is available free of charge to any client or
prospective client upon request or it may be obtained at http://www.vcm.com/policies.
The Code applies to all employees of Victory Capital or anyone deemed an access person by
the Chief Compliance Officer (an “Access Person”). All Victory Capital employees are required
to comply with the Code’s terms as a condition of continued employment and must read and
certify to their compliance with its terms annually. The Code requires all Access Persons to
place the interests of Victory Capital clients ahead of their own interests at all times and to avoid
any actual or potential conflicts of interest. All actual or potential conflicts of interest must be
disclosed to the Compliance, Risk and Legal department, including those resulting from an
employee’s business or personal relationships with customers, suppliers, business associates,
or competitors of Victory Capital. The Code contains policies and procedures relating to, among
other things:
Personal trading, including reporting and pre-clearance requirements for all Access
Persons
Conflicts of interest, including policies relating to restrictions on trading in securities of
clients and suppliers, gifts and entertainment, political contributions and outside
business activities
In general, the Code requires Access Persons to disclose any personal trading accounts within
10 calendar days after becoming subject to the Code. Access Persons must report their
holdings of reportable securities (as defined below) and any broker, dealer or bank account that
holds such reportable securities. All trades in reportable securities for personal accounts must
be pre-cleared and are monitored by compliance personnel. A “reportable security” is any
security in which an Access Person has a beneficial interest and is not (i) a direct obligation of
the U.S. government, (ii) bankers’ acceptances, bank certificates of deposit, commercial paper,
and high quality short-term debt instruments, including repurchase agreements; (iii) shares
issued by money market funds; and (iv) investments in qualified tuition programs (for example,
529 Plans).
Furthermore, in order to limit the effect of any conflicts of interest that may exist between
securities trading in personal accounts and clients’ best interests, the Code establishes a
blackout period (as described below), which requires a short-term holding period and limits the
number of personal trades that may be made.
Subject to limited exceptions, Access Persons may not purchase or sell, directly or indirectly,
any reportable security within seven (7) calendar days before or three (3) calendar days after a
Victory Capital client has a buy or sell in that same security (the “blackout period”). In relation
to the CEMP Indexes, a longer blackout period is established for the CEMP investment team
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and other Victory Capital employees who have access to rebalance trade information relating to
the semi-annual rebalancing of CEMP Indexes (an “Index Access Person”). Such Index
Access Persons may not purchase or sell equities in their personal accounts during index
blackout periods, but may trade other securities, including open-end mutual funds and ETFs for
which Victory Capital does not act as adviser or sub-adviser.
The Code also limits personal trading in reportable securities (and the potential for conflicts) by
requiring Access Persons to hold purchases of reportable securities for period of at least 60
calendar days and limiting the number of trades in reportable securities to 20 per calendar
quarter.
Victory Capital and its related persons may recommend that clients purchase securities in which
Victory Capital or its related persons have a material financial interest. As a result, Victory
Capital and its related persons may be directly or indirectly benefitted as a result of investments
by clients in those securities. For example, Victory Capital may have discretionary authority to
cause clients to invest in the Victory Funds. Victory Capital will benefit if clients invest in the
Victory Funds because Victory Capital receives asset-based advisory fees from the Victory
Funds. Victory Capital and its related persons also may have material ownership interests in
the Victory Funds and may benefit as a result of investments in the Victory Funds made by
Victory Capital clients. In addition, Victory Capital and its related persons also may have
material ownership interests in the Cerebellum Funds or the Victory UCITS and may benefit as
a result of investments in the Cerebellum Funds or the Victory UCITS made by Victory Capital
clients. Victory Capital and its related persons may purchase or otherwise acquire securities in
which Victory Capital and its related persons have a material financial interest on terms different
from, and more favorable than, those available to Victory Capital clients. Victory Capital, when
making investment decisions, may have an incentive to favor accounts in which it or its related
persons have material financial interests. To address these conflicts, Victory Capital follows
procedures with respect to the allocation of investment opportunities among its clients, including
procedures with respect to the allocation of limited opportunities (for more information, please
see Item 6 and Item 12 herein).
Victory Capital and its related persons may invest in securities that it purchases for clients or
that are already held by clients, and Victory Capital and its related persons may already own
securities that are subsequently purchased for clients. The prices or terms on which Victory
Capital and its related persons invest may be more favorable than the prices or terms on which
a client may subsequently invest or previously have invested in such securities. Victory Capital
and its related persons also may buy or sell a specific security for their own accounts that they
do not buy or sell for clients. In addition, Victory Capital and its related persons, for themselves
or their clients, may take a conflicting position in a security in which Victory Capital has invested
client assets. For example, Victory Capital and its related persons, on behalf of themselves or
their clients, may sell a security that a Victory Capital client continues to hold, or may buy a
security that Victory Capital has sold for a client. This may be the case whether or not Victory
Capital or its related persons are aware of such contrary positions. As described above, the
Code and Victory Capital’s trade allocation procedures seek to limit the effects of conflicts that
arise as a result of personal trading and promote fairness across client accounts.
Victory Capital is committed to ensuring that any participation in the political process by its
employees is consistent with solid corporate governance practices and in compliance with legal
requirements. Thus, the Code requires pre-approval of any political contributions to: (1)
covered government officials (as defined below); (2) federal candidate campaigns and affiliated
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committees; (3) Political Action Committees (PACs) and Super PACs; and (4) non-profit
organizations that may engage in political activities, such as 501(c)(4) and 501(c)(6)
organizations. A “covered government official” means a state or local official, a candidate for
state or local political office, or a federal candidate currently holding state or local office.
Further, Victory Capital’s gifts and entertainment policies and procedures are designed to avoid
impropriety or the appearance of impropriety by its employees. Conflicts of interest may occur
when one receives or provides gifts or entertainment. The Code requires disclosure of the
receipt of gifts or provision of entertainment in excess of $50 to Victory Capital employees (or
the giving of gifts or provision of entertainment in excess of $50 by Victory Capital employees,
as the case may be) from (or to, as the case may be) present or prospective customers,
suppliers or vendors with whom an employee maintains an actual or potential business
relationship. Victory Capital employees are prohibited from receiving or giving cash or cash
equivalents.
All employees of Victory Capital are required to disclose and have approved all outside
business activities or other activities, such as holding a political office or any political
appointments, service as a director on any other company, any other employment or any other
outside business activity.
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ITEM 12: BROKERAGE PRACTICES
FACTORS CONSIDERED IN SELECTING OR RECOMMENDING
BROKERS-DEALERS FOR CLIENT TRANSACTIONS
Victory Capital selects brokers for the execution of transactions for client accounts in
accordance with its best execution policies and procedures. In making a decision about best
execution, Victory Capital considers a number of factors, including but not limited to:
Best execution price
Commissions charged
Size and difficulty of the order
Access to sources of supply or market
Ability to commit capital
Financial condition
Integrity and reputation
Execution and operational capabilities (for example, whether electronic trading
is offered)
Market knowledge
Acceptable record keeping
Timely delivery of and payment on trades
Ability to handle block trades
Quality of brokerage services and research materials
“Best execution” is generally understood to mean the best overall qualitative execution, not
necessarily the lowest possible commission cost. Such commissions vary among different
broker-dealers, and a particular broker-dealer may charge different commissions according to
such factors as the difficulty and size of the transaction and the volume of business transacted
with the broker-dealer. Victory Capital may incur brokerage commissions in an amount higher
than the lowest available rate based upon brokerage and research provided to Victory Capital.
As discussed further below, Victory Capital believes that the continued receipt of supplemental
investment services (such as research) from dealers is important to its provision of high-quality
portfolio management services to its clients.
In seeking best execution, Victory Capital will generally solicit bids and offers from more than
one broker-dealer. Victory Capital’s traders have the discretion to determine which broker-
dealer will be used. The trading desk also negotiates any broker commissions, which are
reviewed periodically for cost competitiveness and execution quality. “Commissions” includes
a mark-up, mark-down, commission equivalent, or any other fee that is charged by a broker-
dealer for executing transactions, and any amounts received from riskless principal transactions
that are eligible for soft dollar credits under Section 28(e) of the Securities Exchange Act of
1934, as amended (“1934 Act”).
Victory Capital may also use an Electronic Communications Network (“ECN”) or Alternative
Trading System (“ATS”) to effect certain trades such as over-the-counter trades when Victory
Capital believes it will result in equal or more favorable execution overall. Victory Capital will
pay a commission to an ECN or ATS that, when added to the price, is lower than the overall
execution price that might have been attained trading with a traditional broker-dealer.
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Clients often grant Victory Capital the authority to select the broker-dealer to be used for the
purchase and sale of securities. When Victory Capital seeks best execution, it considers the
aforementioned factors as well as research services that are provided in connection with “soft
dollar” arrangements (explained in more detail below). When Victory Capital selects a broker-
dealer, it does not consider a broker-dealer’s promotion or sales of shares of the Victory Funds
or any other registered investment company, nor does it consider client referrals from a broker-
dealer or third-party.
At times, Victory Capital may select a broker-dealer that charges a commission in excess of that
which another broker-dealer might have charged for effecting the same transactions. Victory
Capital is not obligated to choose the broker-dealer with the lowest available commission rate if,
in Victory Capital’s reasonable judgment, the total cost or proceeds from the transactions may
be less favorable than what may be obtained elsewhere or if a higher commission is justified by
the service or research provided by another broker-dealer.
Victory Capital has implemented a series of internal controls and procedures to address the
conflicts of interest associated with its brokerage practices. To determine that it is receiving
best execution for its transactions over time, Victory Capital will obtain information as to the
general level of commission rates being charged by the brokerage community, from time to
time, and will periodically evaluate the overall reasonableness of brokerage commissions paid
on client transactions by reference to such data. In determining the reasonableness of any
particular commission, Victory Capital will only take into account any benefits that may be
provided to its discretionary client accounts as a result of any research received. To the extent
Victory Capital has been paying higher commission rates for its transactions, Victory Capital will
determine if the quality of execution and the services proved by the broker-dealer justify these
higher commissions. Victory Capital’s traders and the Trading Oversight Committee review and
evaluate trade execution.
RESEARCH AND OTHER SOFT DOLLAR BENEFITS
As noted above, Victory Capital’s primary objective in broker-dealer selection is to comply with
its duty to obtain best execution of orders for clients. Best execution does not necessarily mean
the lowest commission, but instead involves consideration of a number of factors (listed above).
One important factor is the quality and availability of useful research, execution-related
products, and other services that a broker may provide in connection with executing trades. A
broker-dealer may be paid with commission dollars (“soft dollars”) in exchange for access to
statistical information and research, which is offered without any commitment to engage in any
specific business or transactions. Soft dollar transactions generally cause clients to pay a
commission rate higher than would be charged for execution only.
The products and services received through soft dollar transactions include investment advice
(either directly or through publications or writings) as to the value of the securities, the
advisability of investing in, purchasing or selling securities, the availability of securities or
purchasers or sellers of securities, analyses and reports concerning issues, industries,
economic factors and trends, portfolio strategy and the performance of accounts and access to
company management. Victory Capital may use soft dollars to acquire proprietary or third-party
research. Proprietary research is created and provided by the broker-dealer; third-party
research is created by a third-party but provided by a broker-dealer.
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To the extent that Victory Capital is able to obtain such products and services through the use of
clients’ commission dollars, it reduces the need for Victory Capital to produce the same
research internally or purchase through outside providers for hard dollars. Thus, these soft
dollar products and services provide economic benefits to Victory Capital and its clients. Victory
Capital may have an incentive to select a broker-dealer in order to receive such products and
services whether or not the client receives best execution. However, Victory Capital may give
trading preference to those broker-dealers that provide research products and services, either
directly or indirectly, only so long as Victory Capital believes that the selection of a particular
broker-dealer is consistent with its duty to seek best execution.
Victory Capital may also receive services which, based on their use, are only partially paid for
through soft dollars (“mixed-use services”). When Victory Capital receives both administrative
benefits and research and brokerage services from the services provided by brokers, Victory
Capital makes a good faith determination of which portion of the service should be paid for with
soft dollars and which portion should be paid for with hard dollars. Victory Capital pays in hard
dollars for any administrative benefits it receives. There is a conflict of interest for Victory
Capital when it assigns these values and may underestimate the value it should pay for the
other services that should be paid in hard dollars by Victory Capital. Victory Capital retains
records of these determinations and payments.
The research products and services provided by broker-dealers through soft dollar
arrangements benefit other Victory Capital clients and may be used in formulating investment
advice for any and all Victory Capital clients, including accounts other than those that paid
commissions to the broker-dealer on a particular transaction. Nonetheless, not all research
generated by a particular client’s trade will benefit that particular client’s account. In some
instances, the other accounts benefited may include accounts for which the accounts’ owners
have directed their portion of brokerage commissions to go to a particular broker-dealer other
than those that provided the research products or services. However, research services
obtained through soft dollar transactions may be used in advising all accounts, and not all such
services would necessarily be used by Victory Capital in connection with the specific account
that paid commissions to the broker-dealer that provided such services.
Victory Capital periodically reviews the past performance of broker-dealers in light of the factors
discussed previously. The overall reasonableness of commissions paid is evaluated by
reviewing what competing broker-dealers were willing to charge for similar types of services.
The evaluation also considers the timeliness and accuracy of the research received.
Some clients may request that Victory Capital not generate soft dollar credits on trades for their
accounts. Victory Capital may accommodate such requests, but trades for these clients may
not experience lower transaction costs. In addition, the trading process for these clients may be
adversely affected in other ways, including that the client may not participate in block orders
with clients that have not made such a request, therefore the client is prevented from receiving
the price and execution benefits of the block order. In addition, and as with other directed or
customized brokerage accounts, the positions of these accounts in trade ordering and trade
rotation may be impacted. Please see “Directed Brokerage” for more information on how
customized brokerage arrangements may adversely impact trading results.
From time to time, Victory Capital may purchase new issues of securities for an account in a
fixed price offering. In these situations, the seller may be a member of the selling group that
will, in addition to selling the securities to clients, provide Victory Capital with research. FINRA
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rules permit these types of arrangements under certain circumstances. Generally, the seller
provides research “credits” at a rate that is higher than that which is available for typical
secondary market transactions.
The use of soft dollars may create an incentive for Victory Capital to select or recommend a
broker-dealer based on receiving such products or services, rather than most favorable
execution for the client. Victory Capital’s Code of Ethics and other procedures are designed to
mitigate the potential conflicts of interest that are raised with the use of soft dollars. In addition,
Victory Capital’s Trading Oversight Committee reviews the use of soft dollar products and
services by Victory Capital and its distribution among clients.
All products and services Victory Capital obtains with soft dollars must be consistent with the
safe harbor provided by Section 28(e) of the 1934 Act.
DIRECTED BROKERAGE
Victory Capital does not recommend, request, or require its clients to use a specified broker-
dealer for portfolio transactions in their accounts. In some cases, clients have directed Victory
Capital to use specified broker-dealers (“directed brokers”) for portfolio transactions in their
accounts. In such a case, Victory Capital is not obligated to, and generally will not, solicit
competitive bids for each transaction or seek the lowest commission rates for the client, as the
commission rates have typically been pre-negotiated between the client and the directed broker.
Since Victory Capital has not negotiated the commission rate and may not be able to obtain
volume discounts, the commission rate charged by the directed broker may be higher than what
Victory Capital could receive from another broker-dealer. In addition, the client may be unable
to obtain the most favorable price on transactions executed by Victory Capital because it may
not be possible to add these orders to block orders. Furthermore, the client may not be able to
participate in the allocation of a security of limited availability (such as an initial public offering).
Victory Capital typically submits directed broker orders after non-directed brokerage orders are
completed (unless Victory Capital steps out the trade, as discussed below). In addition, directed
brokerage orders may not be executed simultaneously due to certain operational limitations.
Due to the timing of order placement, Victory Capital may not be able to fill the entire order with
a particular directed broker. Moreover, when the time for placement of the order with the
directed broker arises, we may determine that it is no longer advantageous for the client which
has directed brokerage (such as wrap fee program clients) to participate in the security
transaction due to price movements or liquidity constraints. In such a case, we would not
execute the transaction on the client’s behalf, thus precluding the client from an investment
opportunity that other clients in the same strategy, whose orders were placed earlier, were able
to partake.
Clients who direct commissions to specified broker-dealers may not generate returns equal to
clients that do not direct commissions. Due to these circumstances, there may be a disparity in
commission rates charged to a client who directs Victory Capital to use a particular broker and
client accounts may experience performance and other differences from other similarly
managed accounts. Clients who direct brokerage should understand that similar brokerage
services may be obtained from other broker-dealers at lower costs and possibly with more
favorable execution. In some instances, pre-negotiated rates have not been made by the client.
In those cases, the client will be charged the broker’s applicable commission rate.
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Wrap fee programs typically call for Victory Capital to only execute client transactions through
the wrap sponsor broker-dealer. In such cases, clients are not typically charged a separate
commission per trade as long as the wrap fee broker-dealer executes the trade. In evaluating a
wrap fee program, clients should recognize that brokerage commissions for the execution of
portfolio transactions executed by wrap fee broker-dealers are not negotiated by Victory Capital
and trades for wrap program accounts may be executed after trades for other types of client
accounts. This may inhibit Victory Capital’s ability to obtain the same level or timeliness of
execution that it may otherwise have if it had been able to execute the entire trade with one
broker-dealer.
TRADE-AWAY TRANSACTIONS
There may be instances when Victory Capital has the ability to trade with brokers other than the
wrap fee broker-dealer. In some cases, this may be required if the broker-dealer is unable to
execute a type of trade (for example, trading in convertible securities), but it may also be
because Victory Capital believes that it can obtain better trade execution than trading through
the wrap fee broker. Regardless of the reason, if Victory Capital trades with a broker other than
the wrap fee broker, the client will often incur a commission cost in addition to the all-inclusive
fee paid to the broker, thereby increasing such clients' overall costs. In certain trades, such as
fixed income or convertible trades, there is no additional commission cost as those trade
execution fees are embedded in the price of the security. These embedded execution fees may
be more or less than what would be incurred if the wrap sponsor executed the trade.
Clients whose accounts are custodied at a broker may have a “trade away” fee imposed by that
broker on any trade that Victory Capital places on behalf of the account with a broker-dealer
other than the custodial broker. While Victory Capital may have full discretion to select a
broker-dealer for transactions for the account, a trade-away fee may adversely affect Victory
Capital’s ability to obtain best price and execution. For example, the trade-away fee for small
volume trades may outweigh the benefit of the volume discounts that can be obtained by
blocking orders or of executing over-the-counter stock and bond transactions with the market-
makers for such securities.
STEP-OUT TRANSACTIONS
Victory Capital may engage in “step-out” brokerage transactions, subject to best execution. In a
“step-out” trade, an investment adviser directs trades to a broker-dealer who executes the
transaction, while a second broker-dealer clears and settles the transaction. The executing
broker-dealer shares its commission with the clearing broker-dealer. Victory Capital engages in
step-out transactions primarily to satisfy client-directed brokerage arrangements of certain client
accounts. In case of directed brokerage, trades are often executed through a particular broker -
dealer and then “stepped-out” to the directed brokerage firm for credit.
AGGREGATION OF ORDERS
As a general rule, Victory Capital will combine orders into block trades when more than one
account on the same trading system is trading the same security with corresponding strategies
(“block orders”). Victory Capital will submit block orders only if such aggregation is consistent
with both its duty to seek best execution and the terms of the investment advisory agreements
with each client for whom trades are aggregated. Victory Capital does not receive additional
compensation or remuneration of any kind from aggregating orders.
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If a purchase order is filled in its entirety, securities will be allocated to accounts according to an
allocation statement, which specifies participating accounts and securities allocation among
them. The allocation statement is typically completed before the aggregated order is placed.
All accounts that participate in the block order are charged the same execution price for the
securities purchased or sold (typically, the average share price for the block order on the same
business day). For equity securities, all accounts are charged the same per share commission
unless a client has a prearranged commission agreement with a directed broker. Any portion of
an order that remains unfilled at the end of the day is rewritten (absent contrary instructions) on
the following day as a new order and those securities will receive a new daily average price to
be determined at the end of the following day and allocated across the block in the same
manner described above.
If a purchase order is partially filled, securities are allocated pro-rata based on the allocation
statement. Under certain circumstances, portfolio managers may allocate executed trades in a
different manner than indicated on the allocation statement (for example, other than on a pro-
rata basis), provided that all accounts in the block order receive fair treatment. In some cases,
de minimis shares will be reallocated or minimum allocation quantities will be used. Orders that
result in small allocations can under certain circumstances cause a client’s account to incur
additional trade ticket charges from its custodian bank if it receives multiple partial allocations.
Portfolio managers may make investment decisions in a strategy regarding a security that is
included in a combination of separate accounts, pooled vehicles and wrap fee accounts. When
this happens, the trading desk uses a “trade rotation” to treat the various types of accounts
fairly as there may be an advantage to trading early.
In a trade rotation, non-directed block orders for separate accounts and pooled vehicles are
traded first. After that, all other accounts are treated equally, and are traded on a rotating
alphabetical basis such that an account that traded first in one rotation will go last in the next.
Therefore, trades for the clients that participate in wrap fee programs and all other directed
brokerage accounts trade equally. In certain circumstances, Victory Capital will proceed with a
trade rotation if it concludes, in its sole and reasonable discretion after considering the market
for those securities, that a UMA sponsor is unable to execute the trades in a reasonable time.
While Victory Capital selects broker-dealers for specific transactions, clients may direct Victory
Capital to use a specific broker-dealer. Some clients may direct Victory Capital to use specific
brokers as part of a commission recapture program. A “commission recapture program” is a
negotiated rebate of commissions paid to brokers, which helps reduce transactions costs for
clients by lowering their overall commission expense. However, when clients direct Victory
Capital to use a specific broker to execute transactions for their accounts, they should be aware
that the use of a directed broker could result in less favorable execution of some portfolio
transactions or a higher net price for certain securities purchased for their account . Clients in a
commission recapture program may not be able to participate in allocations of new issues or
other investment opportunities purchased from discretionary brokers; and the inability to receive
the benefit of reduced commissions or more favorable prices available in blocked trades with
other Victory Capital clients.
When circumstances are appropriate, Victory Capital will include the directed broker
transactions in a blocked order through a step-out trade. If Victory Capital is unable to execute
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the directed trade as part of a blocked order, Victory Capital will place the order for the directed
trade through the specified broker, and the execution cost of the transaction may be greater.
For accounts with directed brokers, order execution is delayed until after non-directed separate
account block orders in the same security are executed (or, if the execution of discretionary
broker trades cannot be fully completed in a single day, for a reasonable time after the
placement of such trades with the discretionary broker). If multiple clients have directed the use
of a specific broker with respect to trades in the same security, Victory Capital will prioritize the
sequence of which directed broker client trades are placed next with a goal of seeking fair and
equitable treatment of such clients over time and best execution under the circumstances.
Victory Capital may choose to place the directed broker trades first or concurrently with
discretionary broker trades in the same security if Victory Capital reasonably believes that the
directed broker trade will not adversely impact the execution of discretionary broker trades.
Victory Capital clients with non-discretionary accounts (such UMA program accounts) are
notified of a recommended purchase or sale of a security after the transaction has been
completed for all discretionary accounts managed by Victory Capital. This delay may have an
adverse impact on the price at which such non-discretionary account is subsequently able to
purchase or sell the security. In certain circumstances, Victory Capital will proceed with a trade
rotation if it concludes, in its sole and reasonable discretion after considering the market for
those securities, that a wrap sponsor is unable to execute the trades in a reasonable time.
ALLOCATION OF OFFERINGS
Victory Capital provides investment advisory services for various clients and may give advice
and take action with respect to any client that may differ from the advice given, or the timing or
nature of action taken, with respect to another client, provided that over a period of time, to the
extent practical, Victory Capital seeks to allocate investment opportunities to each client account
in a manner that it reasonably believes is fair and equitable relative to other similarly-situated
client accounts.
When allocating trades, portfolio managers may use other allocation methods in place of a pro-
rata allocation. The relevant factors considered include, but are not limited to:
Size of account
Current industry or issuer weighting
Account objectives, restrictions and guidelines
Meeting target allocations
Regulatory restrictions
Risk tolerances
Cash availability and liquidity needs
Limitations to supply or demand for a particular security
Account funding requirements
Priority to certain accounts with specialized investment objectives and policies
From time to time, Victory Capital may have the opportunity to acquire securities for its clients
as part of an initial public offering (“IPO”) or a secondary offering (together with an IPO, an
“offering”). In placing orders for offerings, Victory Capital will first determine the investment
style or styles, as well as the eligible clients within a style, for which the offering is most
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applicable. Allocation factors include, but are not limited to: (1) the nature, size and expected
allocation of a deal; (2) the aggregate size of the investment styles or the size of the client’s
account; (3) the investment objectives and restrictions of the account and individual clients; (4)
the client’s eligibility to purchase offering securities under applicable FINRA rules; (5) the risk
tolerance of the client; and (6) the client’s tolerance for possibly higher portfolio turnover. The
portfolio management teams for those styles will submit indications of interest on behalf of their
client accounts to Compliance for pre-approval. If approved, each Victory Capital trading desk
will separately submit all of its indications to the offering dealer.
All IPO allocations are subject to client and regulatory restrictions. Participating client accounts
also must certify their eligibility as determined by FINRA rules. Clients that participate in wrap
fee programs are not able to receive IPO allocations due to unknown client eligibility and
restrictions around trading away. For institutional clients with directed brokerage arrangements,
Victory Capital may trade away their accounts to the offering broker, subject to any trade-away
fees charged by the directed broker.
If an aggregated IPO order is partially filled, securities generally will be allocated pro-rata
according to the trading desk’s indication of interest. However, if a pro-rata allocation results in
an odd lot or in an amount too small for a client’s account, the portfolio manager may back out
of the client’s allocation and those shares will be reallocated pro-rata to the remaining
participating clients. Share amounts may be rounded to the nearest round lot. Victory Capital
regularly reviews the allocation of IPO securities, which may result in a reduction or no
allocations of these securities for a period of time. When a client has a small asset base,
participation in IPOs may significantly increase the client’s total returns, and as the assets grow,
any impact of such offerings on the client’s total return may decline.
FOREIGN EXCHANGE (FX) TRANSACTIONS
For equity transactions in foreign securities, Victory Capital, or a designated third-party
specialist, generally executes an FX transaction on behalf of the participating accounts in order
to purchase the foreign security using the currency of the applicable country. In instances
where a client elects to execute its own FX transactions or direct the execution of its FX
transactions to a specific market, the client’s account may experience negative or positive
performance dispersion from other accounts managed by Victory Capital in the same style and
for which Victory Capital has full discretion to select the counterparty for FX transactions.
DERIVATIVES
Victory Capital may enter into derivatives transactions when and if advisable to implement
clients’ investment objectives or other derivative transactions (e.g., index futures contracts) in
order to gain short-term exposure to a particular market or as a cash management strategy.
Derivative counterparties are selected based on a number of factors, which include credit rating,
execution prices, execution capability with respect to complex derivative structures, and other
criteria relevant to a particular transaction.
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ITEM 13: REVIEW OF ACCOUNTS
A portfolio manager regularly reviews the portfolios of each account managed by Victory Capital
to determine whether to take any actions for that portfolio, based on its investment objectives,
policies, and assets, and more generally, based on Victory Capital’s review of economic and
market conditions.
Victory Capital’s Compliance Department also monitors portfolios and reviews potential
violations of investment objectives and policies for each portfolio on a daily basis.
Accounts are also reviewed with the client on a periodic basis to assess performance and to
discuss whether there are any changes to the client’s investment mandate. At a minimum,
portfolio managers and client relationship managers review accounts with clients on an annual
basis; however, most accounts are reviewed with clients on a quarterly basis (or as otherwise
specified by a client’s IPS).
Victory Capital provides separate account clients a written appraisal of their assets at least
quarterly. This appraisal describes each security held in the client’s account and provides cost
and current market value, and other information concerning the account. In addition, Victory
Capital provides such clients, each quarter and upon request at any time, a report of the
investment performance of their account. Gain and loss, purchase and sale, and transaction
summary reports, as well as portfolio commentary, are available to clients whose accounts are
managed on a separate account basis upon request.
Members of the portfolio management teams for each of the Victory Funds regularly report to
the Trustees of the relevant Victory Funds regarding the funds’ performance. In addition, each
of the Victory Funds provides shareholders with a semi-annual written report containing
performance and financial information, as required by applicable law. The Victory Funds also
file with the SEC an annual report regarding the Funds’ proxy voting records and a quarterly
report regarding the funds’ portfolio holdings
Where Victory Capital serves as an unaffiliated investment adviser or portfolio manager through
wrap fee programs or other programs established by other financial intermediaries, or to
unaffiliated pooled vehicles, Victory Capital generally relies on the program sponsor or
distributor to provide clients with periodic account statements.
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ITEM 14: CLIENT REFERRALS AND OTHER COMPENSATION
Victory Capital has not entered into any client solicitation agreements with third party marketers.
Some of Victory Capital’s clients and prospective clients retain investment consultants or other
intermediaries to advise them on the selection and review of investment managers. Victory
Capital may also manage accounts introduced to Victory Capital through consultants. These
consultants or other intermediaries may recommend Victory Capital’s investment advisory
services, or otherwise place Victory Capital into searches or other selection
processes. Although Victory Capital does not pay for client referrals, Victory Capital, from time
to time, has business relationships with consultants, intermediaries, or their affiliates. These
business relationships include, but are not limited to, Victory Capital providing investment
advisory services to their proprietary accounts, purchasing their software applications or other
products or services or inviting them to events that are hosted by Victory Capital.
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ITEM 15: CUSTODY
Victory Capital does not take custody of client assets. Clients must appoint a qualified
custodian (as defined in Item 5 herein) to hold their assets. Should Victory Capital inadvertently
receive client securities or funds from a third party, Victory Capital will forward promptly such
securities or funds to the client or the client’s custodian following receipt thereof. In addition to
taking possession of client assets, custodians settle transactions, send monetary wires, and
perform other miscellaneous administrative services. Custodians are directed to accept
instructions from Victory Capital regarding the assets in the client’s account. Clients are
responsible for the acts of their custodians and all direct expenses of the account, such as
custodial fees and brokerage expenses.
If authorized by a client, advisory fees may be billed directly to and paid from the client’s
account, which are reflected in quarterly account statements from the custodian. (Some
custodians will provide statements more frequently than on a quarterly basis.) Account
statements also detail transactions and holdings in the account. Victory Capital sends (and
other service providers may send) periodic account statements to clients related to their
account. Victory Capital urges clients to review carefully and compare for discrepancies all
account statements.
Victory Capital may be deemed to have custody of a private fund for which it serves as a
managing member or general partner. On an annual basis, Victory Capital will send investors in
such private fund the fund’s audited financial statements.
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ITEM 16: INVESTMENT DISCRETION
Victory Capital typically accepts discretionary authority to manage securities accounts on behalf
of its clients by entering into a written investment advisory agreement with the client. Where
Victory Capital has discretionary authority, Victory Capital will make all investment decisions for
the account and, when it deems appropriate and without prior consultation with the client, buy,
sell, exchange, convert, and otherwise trade in any stocks, bonds, other securities, and other
financial instruments, subject to any written IPS or investment guidelines or restrictions (which
may include (without limitation) restrictions on: the mark et-capitalization of investments held in
the account, cash levels permitted in the account, the purchase of foreign securities, or the
types of investments or techniques that may be used in managing the account) provided by the
client. Some Victory Capital clients, such as ERISA clients, are also restricted by law from
making certain investments. Certain investment restrictions may limit Victory Capital’s ability to
execute the strategy and, as a result, may reduce performance. Victory Capital’s clients agree to
respond to inquiries and confirm Victory Capital’s authority to manage the account of the
discretionary relationship with necessary parties.
Some clients may direct Victory Capital’s to execute, or seek to execute, subject to best
execution, some or all of their security trades with a specified broker or dealer. Such direction is
commonly referred to as directed brokerage. In selecting a directed broker, the client has the
sole responsibility for negotiating commission rates and other transaction costs with the directed
broker (for more information on directed brokerage, please see Item 12 herein).
Victory Capital manages a limited portion of its business in a non-discretionary manner,
predominately through UMA programs. The investment management contract with the UMA
sponsor generally specifies that the sponsor retains investment discretion and is responsible for
executing securities trades. Under these types of arrangements, Victory Capital provides UMA
sponsors with a model portfolio from which the sponsor can choose to deviate (for more
information on UMA programs, please see Item 4 herein).
Certain client-directed investment restrictions may limit Victory Capital’s ability to fully execute the
strategy and, as a result, may have a negative impact on performance.
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ITEM 17: VOTING CLIENT SECURITIES
Victory Capital’s Proxy Voting Policies and Procedures (“Proxy Voting Policy”) govern how it
votes proxies relating to securities owned by clients who have delegated voting authority and
discretion to Victory Capital. Victory’s Proxy and Corporate Activities Committee (the “Proxy
Committee”) determines how client securities will be voted.
Victory Capital’s proxy voting guidelines (“Guidelines”) were established to assist in voting
proxies. There are occasions a vote contrary to the Guidelines may be warranted if it is in the
best interests of the client or if it is required under the account’s governing documents. Victory
Capital seeks to act in a manner consistent with the best interest of its clients when it votes
client proxies; however, a conflict of interest may exist between Victory Capital and its clients in
certain circumstances. The Guidelines are intended to limit such conflicts when voting proxies.
If such conflict is not resolved by voting according to the Guidelines, the Proxy Committee may
seek guidance from other internal sources with related expertise. The Proxy Committee
documents all voting exceptions (for example, if the Proxy Committee votes against or withholds
a vote for a proposal that is generally approved, or votes in favor of a prop osal that is generally
opposed).
In some circumstances, a portfolio manager, analyst or member of the Proxy Committee may
request an override. Upon such request, the Proxy Committee reviews supporting
documentation to determine whether the override request is in the best interests of clients. An
override request can be approved by a majority of the available voting members of the Proxy
Committee.
Victory Capital has retained Institutional Shareholder Services (“ISS”) to perform the
administrative tasks of receiving proxies, proxy statements, and voting proxies in accordance
with the Proxy Voting Policy. ISS shall have the authority to vote proxies only in accordance
with standing or specific instructions given by Victory Capital.
Clients may direct Victory Capital to vote their proxies in a manner that may result in a vote that
is different from the way Victory Capital might vote proxies of other clients. For example, some
labor unions may instruct Victory Capital to vote proxies for their accounts in accordance with
the AFL-CIO proxy voting standards. For clients who request AFL-CIO proxy voting, Victory
Capital has directed ISS to use the Taft-Hartley proxy voting guidelines to recommend how to
vote such proxies. Clients may direct Victory Capital’s vote on a particular solicitation by
contacting their Victory Capital client manager or emailing an inquiry to
client_service_team@vcm.com.
In the event Victory Capital does not have authority to vote client securities, client s should make
separate arrangements with their custodians regarding the delivery of proxies and other
solicitation materials. These clients may contact their Victory Capital client manager or email an
inquiry to client_service_team@vcm.com with questions regarding particular solicitations.
For a copy of the Proxy Voting Policy, please visit Victory Capital’s website at
http://www.vcm.com/policies. To obtain information on specific proxies voted by Victory Capital,
clients may contact their Victory Capital client manager or email an inquiry to
client_service_team@vcm.com.
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ITEM 18: FINANCIAL INFORMATION
This item is not applicable to Victory Capital.
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ITEM 19: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
This item is not applicable to Victory Capital.
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Appendix A
Victory Capital Associated Persons
Michael Ade, CFA, is a Portfolio Manager at RS Investment Management (Singapore) Pte. Ltd.
Prior to joining the firm in 2012, he worked at Principal Global Investors (Singapore) Limited as
a portfolio manager for eight years. He previously worked as an analyst at Principal Global
Investors (USA). Mr. Ade holds a bachelor’s degree in finance from the University of Wisconsin.
Antonio Alvarez, CFA, is an Analyst at RS Investment Management (Singapore) Pte. Ltd.
Prior to joining the firm in 2012, he worked at Principal Global Investors (Singapore) as a
research analyst and member of the emerging markets team. He previously worked at Principal
Global Investors (UK) as a financial analyst, and at Oxford Analytica Ltd (UK) as a consultant.
His background also includes a position as head of the macroeconomic analysis department for
the Ministry of Finance, Mexico. Mr. Alvarez holds a master’s degree in economics from the
University of Oxford.
Tammy Belshaw, CFA, is Head of Emerging Markets Research at RS Investments (UK)
Limited. Prior to joining the firm in 2012, she worked at Principal Global Investors as a research
analyst and member of the emerging markets team, and at Citigroup Asset Management as a
research analyst. She previously worked at Watson Wyatt as an investment consultant and
equity research manager. Ms. Belshaw holds a master’s degree in economics from Cambridge
University.
Zoe Chow is an Analyst at RS Investment Management (Singapore) Pte. Ltd. Prior to joining
the firm in 2012, she worked at Principal Global Investors (Singapore) Limited as a research
analyst and member of the emerging markets team, coordinating quantitative analysis and
portfolio analytics for Diversified Emerging Markets and Asian Equity portfolios. Ms. Chow holds
a bachelor’s degree in finance from Singapore Management University and is a CFA Level 3
candidate.
Tony Chu, CFA, is a Portfolio Manager and Analyst at RS Investments (Hong Kong) Limited.
Prior to joining the firm in 2012, he worked at Principal Global Investors (HK) Limited as a
portfolio manager. He previously worked at Principal Asset Management (Asia) Limited as a
portfolio manager, and at INVESCO Hong Kong Limited as an investment analyst and associate
portfolio manager. Mr. Chu holds a bachelor’s degree in commerce from the University of
Queensland and a master’s degree in commerce from the University of New South Wales.
David Horie, CFA, is an Analyst at RS Investments (Singapore) Limited. Prior to joining the
firm in 2013, he worked at JG Partners, Nomura Research, and Wellington Management as an
equity research analyst. He previously held roles at McKinsey & Company and the Japan
Department of Treasury. Mr. Horie holds an MS in finance from the University of London and an
MBA from the University of California, Los Angeles.
Roy Law, CFA, is an Analyst at RS Investments (Hong Kong) Limited. Prior to joining the firm in
2012, he worked at Principal Global Investors (HK) Limited as an analyst on the emerging
markets team. He previously worked at Motorola Asia Pacific Limited as an assistant engineer.
Mr. Law holds a bachelor’s degree in electronic & communications engineering from the
University of Hong Kong.
Page | 60
Privacy Policy
FACTS WHAT DOES VICTORY CAPITAL DO WITH YOUR PERSONAL INFORMATION?
Why? Financial companies choose how they share personal information. Federal law
gives consumers the right to limit some but not all sharing. Federal law also
requires us to tell you how we collect, share, and protect personal information.
Please read this notice carefully to understand what we do.
What? The types of personal information we collect and share depend on the product
and services you have with us. This information can include:
Social Security number and investment experience
Account balance and transaction history
Assets and income
How? All financial companies need to share customer's personal information to run
their everyday business. In the section below, we list the reasons financial
companies can share their customers' personal information; the reasons Victory
Capital chooses to share, and whether you can limit this sharing.
Reasons we can share your personal
information
Does Victory Capital
Share?
Can you limit the
sharing?
For our everyday business purposes - such
as to process your transactions, maintain your
accounts, and respond to court orders and
legal investigations, or report to credit bureaus
Yes No
For our marketing purposes - to offer our
products and services to you
Yes No
For joint marketing with other financial
companies
No We don't share
For our affiliates' everyday business
purposes - information about your
transactions and experiences
Yes No
For our affiliates everyday purposes -
information about your credit worthiness
No We don't share
To our affiliates to market to you No We don't share
For nonaffiliates to market to you No We don't share
Questions? Call 1-877-660-4400 or visit www.vcm.com
Page | 61
Who we are
Who is
providing this
notice?
Victory Capital Management Inc. and Victory Capital Advisers, Inc., together
referred to as “Victory Capital”.
What we do
How does
Victory Capital
protect my
personal
information?
To protect your information from unauthorized access and use, we use
security measures that comply with federal law. These measures include
computer safeguards and secured files and buildings.
How does
Victory Capital
collect my
personal
information?
We collect your personal information, for example, when you:
open an account or enter into an investment advisory contract
direct us to buy or sell securities
seek advice about your investment.
We also collect your personal information from other companies.
Why can't I limit
all sharing?
Federal law gives you the right to limit only:
sharing for affiliates' everyday business purposes – information about
your creditworthiness
affiliates from using your information to market to you
sharing for nonaffiliates to market to you
State laws and individual companies may give you additional rights to limit
sharing.
Definitions
Affiliates Companies related by common ownership or control. They can be financial
and nonfinancial companies.
Victory Capital Management Inc. and Victory Capital Advisers, Inc.
are affiliates of one another because they are under indirect common
control of Victory Capital Holdings, Inc.
Nonaffiliates Companies not related by common ownership or control. They can be
financial and nonfinancial companies.
Victory Capital does not share with nonaffiliates so they can market
to you.
Joint Marketing A formal agreement between nonaffiliated financial companies that together
market financial products or services to you.
Victory Capital does not jointly market.
Other Important Information
You may have other privacy protections under applicable state laws.
This brochure supplement provides information about Gary Miller, James Albers, Greg Conners, Jeffrey
Graff and Michael Rodarte that supplements the Victory Capital Management Inc. brochure (ADV Part
2A). You should have received a copy of that brochure. Please contact Victory Capital’s Chief
Compliance Officer at the number listed above if you did not receive Victory Capital Management Inc.’s
brochure or if you have any questions about the contents of this supplement .
Part 2B of Form ADV
Brochure Supplement
Sycamore Capital
Sycamore Mid Cap value Equity
Sycamore Small Cap Value Equity
March 31, 2017
4900 Tiedeman Road, 4th Floor
Brooklyn, OH 44144
Phone: (877) 660-4400
www.vcm.com
www.victoryfunds.com
Investment Adviser Brochure Supplement
2
Gary Miller
ITEM 2: EDUCATIONAL BACKGROUND AND BUSINESS BACKGROUND
Mr. Miller is the Chief Investment Officer and lead portfolio manager of the Sycamore strategies.
He joined Victory Capital in 1987. Prior to his tenure as portfolio manager, Mr. Miller served as
an equity research analyst for the Sycamore strategies.
Mr. Miller holds a B.B.A. in accounting from the University of Cincinnati and an MBA from Xavier
University.
ITEM 3: DISCIPLINARY INFORMATION
This individual does not have any discipline information to report.
ITEM 4: OTHER BUSINESS ACTIVITES
This individual does not have any other business activities to report.
ITEM 5: ADDITIONAL COMPENSATON
This individual does not receive any additional compensation.
ITEM 6: SUPERVISION
All members of the investment portfolio teams are supervised by each of the Chief Executive
Officer of Victory Capital and the President of the investment franchises, Messrs. David C.
Brown and Kelly Cliff, respectively. Investment portfolio teams are supervised in a variety of
ways throughout the year, which include: periodic reviews of buys and sells, quarterly
evaluations and reports from Victory Capital’s quantitative risk team, semi-annual reviews of
performance, market outlook, risk analysis and competitive positioning. Each supervised
person is subject to Victory Capital’s Code of Ethics, which is overseen by the Chief Compliance
Officer, his staff and senior management. Messrs. Brown and Cliff can be reached at (877)
660-4400.
ITEM 7: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
Not Applicable
Investment Adviser Brochure Supplement
3
James Albers
ITEM 2: EDUCATIONAL BACKGROUND AND BUSINESS BACKGROUND
Mr. Albers is a portfolio manager for the Sycamore equity strategies; he joined Victory Capital in
2005. Prior to Victory Capital, Mr. Albers was a consultant with Accenture and IBM Global
Services.
Mr. Albers earned a B.S. from University of Wisconsin and a M.S. from University of Wisconsin.
He is also a CFA® charterholder.1
ITEM 3: DISCIPLINARY INFORMATION
This individual does not have any discipline information to report.
ITEM 4: OTHER BUSINESS ACTIVITES
This individual does not have any other business activities to report.
ITEM 5: ADDITIONAL COMPENSATON
This individual does not receive any additional compensation.
ITEM 6: SUPERVISION
All members of the investment portfolio teams are supervised by each of the Chief Executive
Officer of Victory Capital and the President of the investment franchises, Messrs. David C.
Brown and Kelly Cliff, respectively. Investment portfolio teams are supervised in a variety of
ways throughout the year, which include: periodic reviews of buys and sells, quarterly
evaluations and reports from Victory Capital’s quantitative risk team, semi-annual reviews of
performance, market outlook, risk analysis and competitive positioning. Each supervised
person is subject to Victory Capital’s Code of Ethics, which is overseen by the Chief Compliance
Officer, his staff and senior management. Messrs. Brown and Cliff can be reached at (877)
660-4400.
ITEM 7: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
Not Applicable
1 The Chartered Financial Analyst designation requires the holder to pass three six-hour exams,
possess a bachelor's degree (or equivalent, as assessed by CFA institute) and have 48 months
of qualified, professional work experience. CFA charter holders are also obligated to adhere to a
strict code of ethics and standards governing professional conduct.
Investment Adviser Brochure Supplement
4
Greg Conners
ITEM 2: EDUCATIONAL BACKGROUND AND BUSINESS BACKGROUND
Mr. Conners is a portfolio manager for the Sycamore equity strategies. Prior to his tenure as
portfolio manager, Mr. Conners was a research analyst for Sycamore’s Small Cap Value Equity
strategy. He joined Victory Capital in 1999, with four years of investment experience as a small
cap research analyst with Carillon Advisers in Cincinnati.
Mr. Conners holds a B.S. in economics from College of Mount St. Joseph and an M.B.A. from
Xavier University.
ITEM 3: DISCIPLINARY INFORMATION
This individual does not have any discipline information to report.
ITEM 4: OTHER BUSINESS ACTIVITES
This individual does not have any other business activities to report.
ITEM 5: ADDITIONAL COMPENSATON
This individual does not receive any additional compensation.
ITEM 6: SUPERVISION
All members of the investment portfolio teams are supervised by each of the Chief Executive
Officer of Victory Capital and the President of the investment franchises, Messrs. David C.
Brown and Kelly Cliff, respectively. Investment portfolio teams are supervised in a variety of
ways throughout the year, which include: periodic reviews of buys and sells, quarterly
evaluations and reports from Victory Capital’s quantitative risk team, semi-annual reviews of
performance, market outlook, risk analysis and competitive positioning. Each supervised
person is subject to Victory Capital’s Code of Ethics, which is overseen by the Chief Compliance
Officer, his staff and senior management. Messrs. Brown and Cliff can be reached at (877)
660-4400.
ITEM 7: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
Not Applicable
Investment Adviser Brochure Supplement
5
Jeffrey Graff
ITEM 2: EDUCATIONAL BACKGROUND AND BUSINESS BACKGROUND
Mr. Graff is a portfolio manager for the Sycamore equity strategies. He joined Victory Capital in
2001, with six years of investment experience. Previously, Mr. Graff was employed as an equity
analyst with A.G. Edwards & Sons in St. Louis, Missouri. He began his career in the investment
industry as an equity research associate for Roulston & Company in Cleveland, Ohio.
Mr. Graff holds a B.B.A. from Cleveland State University and a Master of Finance from St. Louis
University. He is also a CFA® charterholder.1
ITEM 3: DISCIPLINARY INFORMATION
This individual does not have any discipline information to report.
ITEM 4: OTHER BUSINESS ACTIVITES
This individual does not have any other business activities to report.
ITEM 5: ADDITIONAL COMPENSATON
This individual does not receive any additional compensation.
ITEM 6: SUPERVISION
All members of the investment portfolio teams are supervised by each of the Chief Executive
Officer of Victory Capital and the President of the investment franchises, Messrs. David C.
Brown and Kelly Cliff, respectively. Investment portfolio teams are supervised in a variety of
ways throughout the year, which include: periodic reviews of buys and sells, quarterly
evaluations and reports from Victory Capital’s quantitative risk team, semi-annual reviews of
performance, market outlook, risk analysis and competitive positioning. Each supervised
person is subject to Victory Capital’s Code of Ethics, which is overseen by the Chief Compliance
Officer, his staff and senior management. Messrs. Brown and Cliff can be reached at (877)
660-4400.
ITEM 7: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
Not Applicable
1 The Chartered Financial Analyst designation requires the holder to pass three six-hour exams,
possess a bachelor's degree (or equivalent, as assessed by CFA institute) and have 48 months
of qualified, professional work experience. CFA charter holders are also obligated to adhere to a
strict code of ethics and standards governing professional conduct.
Investment Adviser Brochure Supplement
6
Michael Rodarte
ITEM 2: EDUCATIONAL BACKGROUND AND BUSINESS BACKGROUND
Mr. Rodarte is a portfolio manager for the Sycamore equity strategies. He joined Victory Capital
in 2006. Previously, Mr. Rodarte worked as an analyst in the corporate and investment banking
groups of Keybanc Capital Markets.
Mr. Rodarte earned his B.B.A. in Finance, Economics, and International Business from Ohio
University. He is also a CFA® charterholder.1
ITEM 3: DISCIPLINARY INFORMATION
This individual does not have any discipline information to report.
ITEM 4: OTHER BUSINESS ACTIVITES
This individual does not have any other business activities to report.
ITEM 5: ADDITIONAL COMPENSATON
This individual does not receive any additional compensation.
ITEM 6: SUPERVISION
All members of the investment portfolio teams are supervised by each of the Chief Executive
Officer of Victory Capital and the President of the investment franchises, Messrs. David C.
Brown and Kelly Cliff, respectively. Investment portfolio teams are supervised in a variety of
ways throughout the year, which include: periodic reviews of buys and sells, quarterly
evaluations and reports from Victory Capital’s quantitative risk team, semi-annual reviews of
performance, market outlook, risk analysis and competitive positioning. Each supervised
person is subject to Victory Capital’s Code of Ethics, which is overseen by the Chief Compliance
Officer, his staff and senior management. Messrs. Brown and Cliff can be reached at (877)
660-4400.
ITEM 7: REQUIREMENTS FOR STATE-REGISTERED ADVISERS
Not Applicable
1 The Chartered Financial Analyst designation requires the holder to pass three six-hour exams,
possess a bachelor's degree (or equivalent, as assessed by CFA institute) and have 48 months
of qualified, professional work experience. CFA charter holders are also obligated to adhere to a
strict code of ethics and standards governing professional conduct.
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#17-4045
Agenda Date: 11/13/2017 Status: Agenda ReadyVersion: 1
File Type: Action ItemIn Control: Pension Trustees
Agenda Number: 4.6
SUBJECT/RECOMMENDATION:
Approve a new agreement between the City of Clearwater and the law firm of Klausner
Kaufman Jensen and Levinson, to serve as outside counsel to the Pension Trustees and the
Pension Advisory Committee (PAC), and authorize the appropriate officials to execute same.
SUMMARY:
The law firm of Klausner Kaufman Jensen & Levinson (previously Klausner & Kaufman, P.A.)
has served as outside counsel to the Trustees and PAC since 2003. The hourly rate was
initially $250 per hour and increased to $300 per hour in May 2008. At this time Klausner
Kaufman Jensen & Levinson is requesting a rate increase to $350 per hour, to be effective
January 1, 2018.
A total of $62,428 in fees was paid to the firm during fiscal year 2017.
The service provided as outside counsel for the pension plan has been exceptional and staff
recommends approval of the new agreement at the rate of $350 per hour.
APPROPRIATION CODE AND AMOUNT:
Budgeted funds are available in 0646-07410-530100-585-000-0000 to fund the increase.
Page 1 City of Clearwater Printed on 11/8/2017