Investment Committee Decisions

The investment committee met on 4/17 and revisited our fixed income investments and their role in the portfolios. The aim of the meeting was to soften volatility and provide more income. A consensus was reached that if we were going to accept some interest rate risk, that we’d want as much yield as possible, while simultaneously maintaining high credit quality (approximately a weighted average A-rated credit quality); the IC felt that lower credit quality would more likely to see a drop in price during times when a “flight to quality” occurs. With this in mind, the IC created a five-leg fixed income strategy (which includes three funds from the previous four-leg mix). The new mix of bond funds has an expected increase in yield of 1% with a reasonable increase in interest rate risk. The IC feels interest rates will be hold steady for the next few quarters, but is committed to revisiting our interest rate risk, firm wide, at a minimum of once per quarter.