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City of Casselberry Police Officers' and Firefighters' Pension Board of Trustees Minutes of August 18, 2015 Meeting Page 2 of 6 5. Reports (Consultants) A. The Bogdahn Group - Quarterly Financial Review Presentation Mr. Jack Evatt, The Bogdahn Group, presented the performance review of investment activity for the quarter ending June 30, 2015. Major Market Index Performance: Overall, the markets were down primarily due to international concerns with Greece and China among others. Bond values decreased due to rising interest rates. Some corrections in value have occurred in the current quarter and should be seen in the September 301 2015 report. Asset Allocation by Segment: The quarter ending June 30, 2015 was consistent with other similar plans with an increase in assets of approximately $300,000. Five to ten years ago, the allocation for Domestic Fixed Income was 35 -40% as opposed to the 19.7% that it is today due to the decrease in bond values and the previously mentioned international concerns. As interest rates lowered, the plan diversified these funds into global funds, real estate, and others. Financial Reconciliation: Return on investment for the quarter has not been the biggest driver of gains, as it was in the past, but the plan has more contributions than payouts and expenses. The return on investment for the fiscal year is doing well and is currently just over $330,000. Real estate was one of the best investment performers in the plan. Comparative Performance: The plan has done well over the quarter and is up by 39 basis points above the benchmark. Total Equity has been much stronger than it has been in the past. Total Fixed Income was in line. Alternative investments have been challenging for many investors, however Bogdahn Group feels that there is a lot of value in those spaces. Domestic Equity was a positive 81 basis points versus a benchmark of 14 basis points, which is very good. The plan has just begun investing in Vanguard and the full quarter is not seen. International Equity had a very good quarter and was above the benchmark as Manning & Napier had a bit of a bounce back before the plan diversified away. Once again, because the investment changes to Transamerica and American Funds EuroPacific are so recent, full quarterly data is not yet available. Global Fixed Income: Both PIMCO and Templeton were down slightly, but still above the benchmark. International Fixed Income: Westwood was down slightly, but did well comparatively. These investments did much better in the short run. When asked, Mr. Evatt predicted that the plan will end positive for the fiscal year, but the return will most likely be in the single digits for returns. B. The Bogdahn Group - Discussion of Domestic Equity Managers Mr. Evatt presented information regarding fund manager options that could be used in place of Manning & Napier for domestic equity investments. The board was presented with three approaches that would blend different managers who specialize in the areas of Large Cap Growth, Large Cap Value, and Small Cap Core. Discussion of the three blended approach options ensued with a final determination made to invest funds utilizing Blend #1 as detailed in the motion.