Presentation Transcript

1. USA Swimming, Inc.

   June 2014
2. Biography Katherine Berke, CFP® Senior Vice President | Senior Portfolio Manager Experience Katherine manages client relationships and implements custom investment management strategies for clients portfolios. Katherine has experience in analyzing a breadth of investment vehicles and has a record of success in creating and implementing a variety of investment strategies for high net worth, institutional and foundation clients. Ms. Berke has more than 20 years of professional experience, including an extensive background in comprehensive financial planning, investment advisory services and business consulting. Credentials MS degree in Management Science from the MIT, Sloan School of Business BS degree in Computer and Management Science from Metropolitan State University of Denver Certified Financial Planner® Involvement Active member of the Financial Planning Association
3. About First Western *Not a bank location **As of September 2013 We have locations in: Arizona: Scottsdale, Phoenix California: Century City*, Downtown Los Angeles Colorado: Boulder, Cherry Creek, Denver, DTC|Cherry Hills, Northern Colorado Wyoming: Jackson Hole*, Laramie* We have two additional investment management offices in Los Angeles, CA. 172 associates $4.7 billion under investment management, advice and administration** Bank assets over $680 million**
4. First Western Investment Management Approach
5. Overview LSC Investment Recommendations USA Swimming Board of Directors’ Resolution (May 7, 2011) Have an investment committee appointed by the board of directors to include the LSC Treasurer. Have a written Investment Policy Statement (IPS) approved by the board of directors. Have a diversified portfolio to meet the IPS’s goals, objectives, and risk profile. Obtain professional advice at a reasonable cost. A written service agreement must clearly state how the advisor is compensated. Advisor must be free of any conflicts of interest (real or perceived) with members of the board of directors and investment committee.
6. Investment Committee Keep the committee small and use an odd number of members Aim for three to seven members Odd numbers help to avoid tie votes Look for people with the right experience, attitude and availability Independent thinking Investment/finance experience preferable Build strong committee leadership Outline roles and responsibilities of the committee members Create an Investment Policy Statement Schedule semi-annual or quarterly meetings with investment advisor to monitor investment strategy and performance
7. Investment Policy Statement Defines goals and objectives for the management of the investment portfolio Defines strategic asset allocation based upon return objectives, downside risk tolerance, time horizon and distributions Asset allocation is predicated on the following: The perception of future economic conditions, including inflation and interest rate levels Historical and expected capital market assumptions Risk tolerance based on long-term objectives USA Swimming’s IPS is on the LSC Financial Management webpage
8. Determine Goals & Objectives Examples of Goals and Objectives: Provide maximum earnings growth based on total return, consistent with a policy of prudent investment and protection of assets Provide steady growth while limiting fluctuations to less than those of the overall stock market Capital appreciation with tolerance for moderate fluctuations in portfolio values Maintain diversification of investment assets Provide liquidity to meet current operating and capital expenditure needs Long-term performance goal is to earn an average annual return of inflation plus 3%
9. Asset Class Returns Past performance is not indicative of future results. Large Cap represented by the IA SBBI S&P 500 TR USD. Small Cap represented by the Russell 2000 TR USD. Intl- Developed represented by the MSCI EAFE GR USD. Intl- Emerging Mkts represented by the MSCI EM GR USD. REITs represented by the FTSE NAREIT All Equity REITs TR. Commodities represented by the DJ UBS Commodity TR USD. High Yield represented by the IA Barclays US HY Corporate Bonds. Absolute Return represented by the Hennessee HF Market Neutral TR USD. Barclays US Agg represented by the Barclays US Agg Bond TR USD. Intermediate Treasuries represented by the Barclays US GovtInterm TR USD. Cash represented by the IA SBBI US 30 Day Tbill TR USD. Source: Ibbotson Associates, First Western Trust, as of 3/31/2014.
10. Asset Class Standard Deviations Past performance is not indicative of future results. Large Cap represented by the IA SBBI S&P 500 TR USD. Small Cap represented by the Russell 2000 TR USD. Intl- Developed represented by the MSCI EAFE GR USD. Intl- Emerging Mkts represented by the MSCI EM GR USD. REITs represented by the FTSE NAREIT All Equity REITs TR. Commodities represented by the DJ UBS Commodity TR USD. High Yield represented by the IA Barclays US HY Corporate Bonds. Absolute Return represented by the Hennessee HF Market Neutral TR USD. Barclays US Agg represented by the Barclays US Agg Bond TR USD. Intermediate Treasuries represented by the Barclays US GovtInterm TR USD. Cash represented by the IA SBBI US 30 Day Tbill TR USD. Source: Ibbotson Associates, First Western Trust, as of 3/31/2014.
11. Diversification Works for Those Who Can Wait Sources: Barclays Capital, FactSet, Robert Shiller, Strategas/Ibbotson, Federal Reserve, J.P. Morgan Asset Management. Returns shown are based on calendar year returns from 1950 to 2012. Growth of $100,000 is based on annual average total returns from 1950-2012. Data are as of 6/30/13.
12. Market-Timing Risk The effect on annual returns when the best month is missed can be significant. 1970 – 2013. Source: Morningstar, First Western Trust.
13. Stocks and Bonds: Risk Versus Return Return Maximum risk portfolio: 100% Stocks 80% Stocks, 20% Bonds 60% Stocks, 40% Bonds 50% Stocks, 50% Bonds Minimum risk portfolio: 28% Stocks, 72% Bonds 100% Bonds Risk
14. Selecting Asset Classes Equities Fixed Income Real Assets Alternative Cash Money Market CDs US Large Cap Core US Large Cap Growth US Income Equity US Mid Cap Core US Mid Cap Growth US Small Cap Core US Small Cap Growth US Small Cap Value US Micro Cap International Developed Emerging Markets US Intermediate-Term Taxable US High Yield US Tax-Exempt Municipal US Short-Term Bond Intermediate-Term Treasury Domestic REITs International REITs Commodities Hedging Strategies Absolute Return
15. Value of Diversification Source: First Western, MorningStar
16. Asset Allocation
17. Guidelines forAsset Classes
18. Process-Driven Investment Management Portfolio Managers Investment Policy Committee (IPC) Clients Sets overall investment strategy IPS-Client Strategy Sets strategic asset allocation guidelines Portfolio Implementation Portfolio Maintenance Capital market assumptions Selection of investable asset classes Quarterly Reviews Selection and monitoring of outside managers Market News Monitoring of proprietary fixed income and equity products Tactical asset allocation decisions “Opportunistic “ investment decisions
19. Russell By The Numbers For the ninth consecutive year, Russell received “Top Marks” in every category of Global Investor magazines 2013 transition management survey.** Received Top MarksIn Every Category For a fifth year in a row, Russell was voted among the top for having best manager due diligence practices in 2013 FundFire survey of consultant relations professionals. Voted Top inDue Diligence Over 6,000 investment products researched As a consultant to some of the largest pools of capital in the world, Russell has over $2.4 trillion in assets under advisement. U.S. $259.8 billion assets under management* Approx. 1,800 associates globally 22 offices worldwide Unless otherwise indicated, all data is as of 12/31/2013. *As of 3/31/2014. Includes $74.8 billion of derivative overlay AUM not included prior to 6/30/2013. The awards shown here do not pertain to specific mutual funds referenced in this presentation. **Global Investor “Top Marks” categories include: Accuracy of pre-trade estimate; operational efficiency; overall service; post-trade analysis; pre-trade analysis; project management; relationship management; reporting during transition; risk management; trading/execution and transparency of fees and costs.
20. The Russell Difference Russell’s Manager Selection Process 15,410 6,350 748 493 Total Manager Products Monitored By Russell Investment Products Continually Monitored and Researched Managers Products With A Primary ‘Hire’ Rating Manager Assigned a Role in a Russell Solution
21. Monitoring Investment Allocation
22. USA Swimming, Inc. Consolidated Account Performance As of 3/31/2014
23. USA Swimming Asset Managers
24. LSC Investment Solutions Implementation Portfolio < $100,000 Bank Deposits, CDs Portfolio - $100,000 - $250,000 Frank Russell Company Broad Diversification Single Style-Allocation Fund LifePoints Funds Lower cost Portfolio - Over $250,000 Frank Russell Company Customized IPS Customized Asset Allocation Institutional Funds Institutional pricing
25. First Western Fee Structure LSC Investment Size Solution Fee Structure Fees IPS $100-$250,000 Investment Mgmt Fee .50% Stand alone Average LifePoints Fund 1.03% Total Approx. Fee 1.53% Over $250,000 Investment Mgmt Fee .50%Stand alone Average Fund Expense .70% Total Approx. Fee 1.20%

26. Fee Based The advisor charges a fee based on a percentage of your account value

    Transaction Based The advisor earns commissions from each investment transaction Understanding Advisory Fees Mutual Funds A Class Shares Front end sales charge Lower expenses B Class Shares Back-end sales charge Higher expenses C Class Shares Back-end charge Higher expenses
27. Fee Based Relationship Example
28. Questions?