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Fund Performance Annual Pension Meeting
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Fund Performance Annual Pension Meeting

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  • Diversification reduces risk many ways to diversify
  • Explain active & passive Explain value, growth
  • Asset mix - no changes in 2003 – 60 / 40 Manager Structure – no changes in 2003 Our diversified investment policy helps to reduce risk Bonds - 2 managers, active & passive Cdn Eq - 3 specialists that complement each other 1 value, 1 growth, 1 core Int’l - 2 active managers US - 1 passive manager
  • In addition, we achieved this return with less volatility than comparators Median Industry average benchmark
  • In addition, we achieved this return with less volatility than comparators Median Industry average benchmark
  • Transcript

    • 1. York University Pension Fund Leona Fields Manager, Pension Fund Annual Pension Information Session April 21, 2006
    • 2. York’s Pension Governance - Internal
      • Plan/Benefits side
        • Board of Governors
        • Vice President, Finance & Administration
        • Pension & Benefits Office
        • All University Committee on Pensions
      • Fund/Investments side
        • Pension Fund Board of Trustees
        • Sub-Committee on Investment Performance
        • Manager, Pension Fund
    • 3. York’s Pension Governance - External
      • Investment Managers
      • Custodian - CIBC Mellon
      • Auditor - Ernst & Young
      • Investment Consultant - Towers Perrin
      • Manager Search Consultant - Brockhouse Cooper
      • Actuary - William M. Mercer
      • Third Party Administrator – Seclon Logic
    • 4. Key Differentiating Factors for York Pension Fund
      • Primarily a Defined Contribution Plan
        • But members do NOT have investment options
      • Benefits depend on investment returns
        • Adjustments after retirement continue to depend on investment returns – not inflation
      • Investment policy decisions must consider multiple risk profiles
        • Plan Sponsor
        • New plan members
        • Members close to retirement
        • Retirees
    • 5. York’s Pension Investment Objectives
      • The Fund shall be managed with the primary objective of providing high rates of return and moderate levels of risk
        • Securing minimum guarantee pensions for all active members while providing potential for growth
        • Managing volatility of money purchase balances
        • Providing a reasonable level of inflation adjustment for pensioners
    • 6. Diversification Reduces Risk
      • “Don’t put all your eggs in one basket”
      • Various parts of the Fund have different characteristics and risk levels
      • Overall risk level of the Fund can be reduced by diversifying across
        • Security holdings
        • Asset classes
        • Investment strategies and styles
        • Investment managers
    • 7. The York U Pension Fund is Well Diversified
      • 5 Asset Classes
        • 40% Canadian bonds
        • 30% Canadian equity
        • 15% U.S. equity
        • 15% International equity
        • Up to 10% Cash
      • 10 Investment Portfolios
        • 2 Canadian bonds (active & passive)
        • 3 Canadian equity (active, complementary styles)
        • 2 U.S. equity (active & passive)
        • 3 International equity (active, complementary styles)
    • 8. Current Pension Investment Policy
    • 9. Investment Results 4-Years ending Dec. 31, 2005
    • 10. Investment Return Summary for 2005
      • Returns Benchmark
      • Canadian Equity 26.0% 24.1%
      • Bonds 6.2% 6.5%
      • U.S. Equity 3.3% 3.5%
      • Int’l Equity 10.9% 10.0%
      • Total Fund return (gross) 12.1% 11.8%
      • Total Fund return (net) 11.7%
      • 4 year Fund return (net) 7.6%
      • Pension Adjustment 1.5%
    • 11. Cash Flow Summary
    • 12. Issues for 2006
      • Review, research and explore alternative sources of investment returns
        • Currency management
        • Long / short market neutral strategies
        • Hedge funds
        • Infrastructure
        • Private equity
        • Global investing