Of this figure, $65 million was for the general fund and $8.023 million for the American Memorial Park fund.
MPLT board consultant Bruce M. Macmillan reported an erosion in the performance of the MPLT investments.
“The markets have been down a bit,” he said.
In his report to the MPLT board last week, Macmillan said the total performance of the general fund for the month of July was at 68 basis points or slightly below its policy index but higher than the objective of 7.5 percent per year.
Despite the volatility of the market, Morgan Stanley Smith Barney senior vice president and MPLT investment consultant Daniel A. Roland told the trustees last week, “Our conservative allocation is keeping us above water.”
The general fund investments performed better as of July 31, 2011 compared to the same period last year. There was an increase of $2.5 million to the total value of investments from $63.8 million in July 2010 to $66.3 million in July 2011.
Of the $65 million in general fund investments, $5.7 million was in large cap core; $3.72 million, emerging markets; $5.88 million, convertibles; $29.1 million, domestic fixed income-core; $3.94 million, high yield; $7.84 million, global fixed income; and $8.82 million, domestic fixed income-core.
For the park fund investments of $8.02 million, $1.48 million was in large cap core; $424,000, emerging markets; $785,000, convertibles; $2.62 million, domestic fixed income-core; $751,000, high yield; $742,000, global fixed income; $1.25, domestic fixed income-core.
Macmillan reported last week that the general fund investments were underweighted by 0.3 percent in domestic large cap core; 1.3 percent overweighted in emerging markets; 0.3 percent short in convertible securities; 11.2 percent overweighted in core fixed income; 1.1 percent overweighted in high yield; 2 percent overweighted in international bonds.
Macmillan also explained that the 11.2 percent overweight in core fixed income was due to the MPLT has yet to fund its local high yield and alternative investments.
According to MacMillan, in their discussion with their investment consultant, Roland asked the board if it would consider “taking some money out of Richmond [which manages core fixed income] and move over to high yield managed by SEIX Advisors.
Richmond Capital still holds the money that was supposed to fund the local high yield and alternative investments.
Macmillan told the trustees, “At this point, based on the status quo, we are not that far out of balance [with our investments].”
He also said it would be difficult to rebalance with two investment vehicles remaining to be funded.
For MacMillan, there was no reason to rebalance “unless the board would like to make some shift in its asset allocation.”
Based on MPLT’s strategic allocation, 10 percent goes to domestic equity, large cap core; 5 percent emerging markets; 10 percent, convertible securities; 45 percent, domestic fixed income; 5 percent, high yield; 5 percent, local high yield; and 10 percent, international bonds.
The board also adopted its fiscal year 2012 budget of $2.18 million.
Of this figure, $2.89 million will come from investments.
As for expenses next fiscal year, the MPLT sees a $136,552 decrease from $851,215 for FY’11.
In the face of a volatile market, the agency reprogrammed its budget for FY’11 and kept its expenses at bay.
From $851,215, the board’s budget had been reduced by $220,353, managing to cut its money management fees by $158,762.
The board also reprogrammed its park fund budget, reducing it by approximately $27,000.
MPLT did receive a cash infusion from the Commonwealth Utilities Corp. when it paid off its $3.5 million by remitting the $245,000 remainder on Aug. 24 including $1,500 in interest.
