Police Retirement Board

City of Columbia, Missouri Meeting Minutes Police Retirement Board Friday, January 22, 2016 Conference Call: Joint Investment Committee 1-877-280-3353, Meeting 11:00 AM ID: 1235305 I. CALL TO ORDER Present: 2- Benjamin Frede and Matthew Pitzer Absent: 3- Ken Burton, Candy Cornman and Allan Bell II. SPECIAL ITEMS Presentation by Marc Shegoski, UBS Mr. Shegoski reviewed the market outlook for domestic and global markets. He stated that the market was up that morning party because the price of oil was up 5-6% due to the major snowstorm expected on the East Coast of the United States. He stated that the portfolio raised 3.97% in cash between last Friday and Monday which represented $4.375 million in cash raised proportionately across the equity managers. Mr. Shegoski said the cash position on the portfolio had moved from about 3.5% to 6.28% to step away from the volatility. Mr. Shegoski then highlighted why this current economic crisis was not similar to ones in the recent past. Mr. Shegoski reviewed the market outlook for domestic and global markets. He said for a long time the Board’s portfolio had overweight equities (60%) and now UBS is recommending a rebalance to a neutral position on equities. Mr. Sears then talked about the gaps that were stated by UBS’ chief investment officer as information UBS is using to inform their investment positioning. Mr. Shegoski clarified “gaps” as worrisome problems. Mr. Sears identified those gaps as services vs. manufacturers; oil supply and demand; global currency valuation; immigration challenges in Europe; and differences between the Fed’s ‘dot plot’ on rate hikes and the market’s rate hike expectations. Mr. Sears then stated that UBS’ opinion is that the bull market from 2009 remains intact, but there is a lot of negative sentiment out there. He explained that to decrease the negative sentiment it would take improvement in economic data, stabilization in commodities and the price of the dollar, corporate profit growth and policy response. Mr. Sears also referred to a chart that showed once the energy sector was eliminated, earnings continued to rise last year. Mr. Shegoski recommended that the Board maintain the move of the cash in the portfolio to the short-term bond investment manager and have another conference call in one week’s time to see where the markets are at that point. He said the move was to de-risk a little bit in the portfolio similar to in 2008 during the Greek crisis. Mr. Shegoski said if the Fed does not raise rates as briskly or something starts to happen in Europe, he would recommend the Board go in the other direction with the portfolio. He said the current move was to be tactical with the money and protect the principle. Mr. Sears then mentioned that Advisory Research was scheduled to come to the next in-person meeting of the Board to discuss MLP’s and the energy sector. City of Columbia, Missouri Page 1 Printed on 8/9/2016 Police Retirement Board Meeting Minutes January 22, 2016 Mr. Shegoski said there was no action scheduled for this call other than scheduling another conference call the following week on Friday, January 29 at 11:30 a.m. III. ADJOURNMENT There being no further business, the meeting was adjourned at 11:21 a.m. Members of the public may attend any open meeting. For requests for accommodations related to disability, please call 573-874-7214. In order to assist staff in making the appropriate arrangements for your accommodation, please make your request as far in advance of the posted meeting date as possible. City of Columbia, Missouri Page 2 Printed on 8/9/2016