Todays conversation Portfolio objectives, assets, and performance - PowerPoint PPT Presentation

Today’s conversation Portfolio objectives, assets, and performance Philosophy and process Environment and performance analysis Outlook and positioning Firm update

ABC Pension’s guidelines Objective  Outperform the S&P 500 by 1.0% to 1.5%, annualized, over a full market cycle Characteristics  Similar to the S&P 500  110± stocks held  Highly diversified (R 2 ≥ .98) Risk Parameters  Beta between 0.99 and 1.01  High-quality companies  No tobacco, weapons, or fossil fuels  Fully invested We strictly adhere to your guidelines and provide written certification of adherence each quarter

Areas ripe with opportunity Economic Infrastructure  Businesses offering goods and services that help other businesses grow and – increase productivity Basic Materials  Businesses in the Energy, Chemicals, and Metals & Mining industries – Lifestyle Consumption  Businesses spanning the spectrum of consumer demand, from necessities to – luxury items Debt & Lending  Businesses tied to credit, the lifeblood of the global economy –

Areas ripe with opportunity Economic Basic Lifestyle Debt & Infrastructure Materials Consumption Lending Offer goods and Are in the Energy, Span the spectrum Are tied to credit, services that help Chemicals, and of consumer the lifeblood of the other businesses Metals & Mining demand, from global economy grow and increase industries necessities to productivity luxury items We are investing in businesses poised to thrive in the economic recovery we anticipate

A tale of two time periods During Volatility Pre-Volatility May 8 to June 30 Mar 31 to May 7 29 27 30 25 Excess Return (bps) 20 15 10 8 7 10 2 5 0 -5 -5 -6 -10 Yield Curve Industry Selection Total Yield Curve Industry Selection Total Allocation Allocation Security selection was strong as volatility accelerated, driving second-quarter outperformance

A culture of continuous improvement Strategies Communication Technology  Launched values-  Redesigned client  Installed latest based global bond reporting package release of portfolio strategy analytics system Are hosting inaugural  Are back-testing market update Are fine-tuning shift   three factors for webinar in October to virtual operations systematic equity strategies We continue to enhance our portfolio management and service capabilities