1 / 15

Portfolio Management

Asset Management Group. Portfolio Management. P R E S E N T E D B Y M. Corinne Larson, CTP Vice President (914) 765-3505 corinne.larson@mbia.com. Investing in Today’s Market. Develop a Plan: Investment Policy Cash Flow Forecasting Investment Strategies.

sherri
Download Presentation

Portfolio Management

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Asset Management Group Portfolio Management P R E S E N T E D B Y M. Corinne Larson, CTP Vice President (914) 765-3505 corinne.larson@mbia.com

  2. Investing in Today’s Market • Develop a Plan: • Investment Policy • Cash Flow Forecasting • Investment Strategies • Execute the Plan: • Investment Instruments • Investment Options • Spread Analysis • Reevaluate the Plan: • Benchmarks • Portfolio Performance • Portfolio Rebalance

  3. Importance of a Benchmark • Control risk in portfolio • Target expected returns • Establish accountability • Promote communication

  4. Characteristics of Benchmarks • Faithful to investment style and discipline it represents • Closely mirror the portfolio • Types of investments • Maturity limits • Active or passive management • Verifiable • Published • Easily calculated

  5. Choosing a Benchmark • Choose a security type • Come from appropriate industry or sector • Have a similar weighted average maturity or duration • Calculate one-month, six-month, and 12-month averages

  6. Choosing a Benchmark • Choose an index • Investable • Measurable • Repeatable • Consistent with portfolio guidelines

  7. Common Benchmarks • Standard & Poor’s LGIP Index • Public Investor 10-bill Performance Index • Constant Maturity Treasury Rates • 3- and 6-months • 1-, 2- and 5-years

  8. Treasury Yield Curve Rates www.treas.gov

  9. Common Benchmarks • Merrill Lynch U.S. Treasury Indices • Salomon U.S. Treasury Benchmark Indices • Lehman Brothers Government Bond Indices • Merrill Lynch U.S. Corporates A-AAA

  10. Where to Find Benchmarks • Wall Street Journal • Barron’s • Bloomberg • Internet • GFOA’s Public Investor newsletter

  11. Portfolio Performance • Compare returns • Evaluate risk incurred to achieve returns • Determine if returns meet expectations • Reevaluate benchmark at least annually or when investment strategy changes

  12. How to Review Performance

  13. Portfolio Rebalancing • Evaluate • Compliance issues • Credit risk • Liquidity needs • Diversification • Market conditions • Interest rate risk • Investment strategies

  14. Portfolio Rebalancing • Diversify • Market sectors or issuers • Rate • Maturity • Match asset allocation goals and tolerance for risk • Adjust WAM for market conditions • Swap out of underperforming securities

  15. Putting It All Together • Establish the framework for investing • Understand investment alternatives • Develop cash flow forecasts • Develop investment strategies • Report investment results

More Related