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Minutes of the September 26, 2013 Retirement Board Meeting
<br />Present: Robert Cunha, Joe Foley, Rob Addelson, Alan Fields, Mike McNabb, Marguerite Oliva
<br />Bob Cunha called the meeting to order at 8:00 AM.
<br />The Board accepted and signed the 092713 Warrant and September payroll. The August minutes
<br />were reviewed and approved as well as the casbbooks for July 2013.
<br />New Members: (30) Raymond Barnabei, Indira Bhupatiraju, Maureen Picariello, Sarah Torilli,
<br />Laura McLain, IA; Lotoya Robinson, Rebecca Malouf, Colleen Magee, Paul Doherty, Efe
<br />Igho - Osagie, Patrick Parhiala, Elizabeth Roberts, Michael Zerdelian, Nicholas Seymourian, Kate
<br />Desjardins, Abigail Gorman, SPED IA; Colleen Mulcahy, Kyle Benson, Kelli Rich, Katherine
<br />Bloom, SSI; Matthew McGee, Barbara Dove, SCTA; Kristin Merta, SSP; Kristen McGrath,
<br />Secretary; Maureen Bamberry, Asst. Database Admin., Victoria Crowley, Katelyn Tierney,
<br />ASA; Bruce Morgan, Senior Assessor; Ronaldo DeFreitas, Custodian; David Amicangiol.i,
<br />HVAC Technician
<br />Retirements: Joanne Arsenault, Municipal Clerk, 11/8/13
<br />Paul Todesco, Mike Trotsky and Eric Nierenberg presented the PRIT Fund Hedge Funds
<br />Portfolio Overview. Eric Nierenberg, Sr. Investment Officer — Hedge Funds and Low
<br />Volatility Strategies, was hired to oversee the PRIT Hedge Funds. He is overseeing the
<br />transition to direct hedge funds, seeking to improve precision of hedge fund performance
<br />attribution, identifying potential new direct hedge fund investments and exploring
<br />methods to lower management fees. The report states that fund returns can be separated
<br />into two pieces through quantitative analysis, beta, which are market exposures, both
<br />traditional and alternative and Alpha, which is viewed as a measure of managerial skill.
<br />PRIM looks to divide their hedge fund investments into passive and active capital
<br />allocations. PRIM already split allocations into passive and active investments in most of
<br />their other asset classes. They are looking to focus the active investments on managers
<br />who can deliver consistent, uncorrelated alpha.
<br />As of 8/31/13 the market value or the PRIT Hedge Funds was $4.8 billion, 9% of the
<br />total PRIT assets. The current long -term target is 10 %. The hedge fund portfolio
<br />consists of 1 fund -of -fund manager, I transition manager and 21 direct hedge fund
<br />managers.
<br />On October l ", Lexington Retirement Board is investing $6mm with PRIT Hedge Funds.
<br />Henry Jaung and LouAnn Eisenhut presented a quarterly review as of 6/30/13 with an
<br />interim update as of 8/31/13. The market value as of 8/31 was $119.9m, a decrease of
<br />$3.3m from 7/31. The Board noted there is too much exposure to emerging markets.
<br />Matthews, Wellington Enduring and PIMCO Global Multi -Asset were the major
<br />contributors to the loss in August. Alan noted since 2008, it was better to be invested in
<br />U.S. markets. The Board chooses mangers by their ability to make tactical decisions and
<br />asked Henry to have a discussion with PIMCO about their expectation going forward
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