MEMORANDUM
TO:
MDTA Board
FROM: Director of Treasury and Debt Kevin Cullity SUBJECT: Investment Strategy and Benchmarks DATE: May 28, 2026
PURPOSE OF MEMORANDUM • Complete the required quarterly review of the MDTA’s investment strategy and associated benchmarks for the period ending March 31, 2026. Investment returns and portfolio composition were discussed in greater detail during the recent Finance and Administration Committee meeting. The committee members support a continuation of the investment strategies for all accounts. KEY POINTS • No changes in strategy or benchmarks are recommended. • Investments conformed to Investment Policy limitations. • Portfolio structuring by account adhered to board approved strategy. o Strategy should remain consistent, despite short-term return volatility associated with the interest rate environment. o Management does not attempt to time market rate changes; Duration Targeted reserves maintain consistent structures. Passive approach to duration, Active in relative-value security selection. • Chosen strategies and benchmark indices represent a reasonable and prudent compromise between long-term, multiyear return/income focus and tolerance for return volatility. o The longer duration strategies employed in certain reserves generate higher return volatility with expected higher average annual returns over multiyear periods.
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