As
investors attempt to navigate this new era, strategy becomes paramount. An
effective strategy can become the foundation for negotiating towards a
successful future. It can create a master plan for investment teams to follow.
The Markets Group Strategy Award seeks to recognize winning strategies for the
current economy in an effort to curate an actionable thought exchange between
allocators.
For 2024,
Jeremy Wolfson, the Chief Investment Officer who currently manages the $20.8
billion Los Angeles Water and Power Employees’ Retirement Plan (WPERP), was
peer nominated as a top CIO in the Southern California region. Despite an
unpredictable market, the plan’s returns, gross of fees for 2023, were 10.82%.
As per the Plan’s report for Fourth Quarter 2023, the fund’s five year annualized
gross returns were 9.33% (net of fees were 9.10%) Per RVK Inc.’s Public Plan
peer universe, this ranked the Plan in the 16th percentile for the
Plan’s 10 year annualized return, which included a top decile rank for the
domestic equity portfolio.
Notably,
in a challenging year like 2022, the Plan ranked in the 15th
percentile. Wolfson’s eye toward risk management kept his 10 Year Sharpe Ratio
(which measures risk) Â in the top decile
of tight risk control compared to his peers—it was 0.76 through December 31,
2023, and the median public plan was 0.59.
Also, the
plan’s 10-year downside risk was 5.18 (82nd percentile, lower is
better, compared to our peers). The peer median was 6.15.
Over the
long-term, the Plan’s strategic asset allocation is typically the key driver of
performance, however, for the one year ending December 2023, the performance
was predominately driven by domestic equity, international equity and private
equity. Global fixed income also contributed to the positive performance aiding
in the diversification of the portfolio.
Strategy
is instrumental in achieving consistent and resilient risk-adjusted returns.
This can only be accomplished by having a robust governance model, a
well-structured plan, and a comprehensive team effort. This involves a rigorous
and disciplined process at all levels, from the investment team, to the
commendable work of the Plan’s Retirement Board, and everyone in between.
Mr.
Wolfson will be honored with a Strategy Award from Markets Group at the 3rd
Annual Southern California Institutional Forum on June 4 in Los Angeles. He
will also share insights into his winning strategy and approach to portfolio
management. The conference for institutional investors will host a stellar lineup of the top investors and chief investment officers in the region.
The Department of Water and Power, is the largest municipal
utility in the United States, employing more than 12,000 people. Mr. Wolfson
has been the Chief Investment Officer at WPERP since 2007 leading the
diversification of the fund beyond the traditional equity and fixed income mix
to include Real Estate, Private Equity, Hedge Funds, Private Credit and other
alternative investments.
Before joining the Department of Water and Power, Mr. Wolfson
served as Chief Investment Officer of the City of Los Angeles Treasurer’s
Office, where he continues to be a board member of the City’s Deferred
Compensation Plan. He is also a committee member of the esteemed Milken
Institute, and Los Angeles CFA Institute. His extensive experience
includes ten years at Bank of America, and two years at FTN Financial, where he
held the position of Vice President and Principal in their institutional fixed
income groups. Mr. Wolfson holds an MBA from Pepperdine Graziadio Business
School, and a Bachelor of Science in Finance from California State University,
Northridge.
His strategic vision, leadership, and commitment to
diversification and risk management have been instrumental in navigating the
complexities of the investment landscape, making him a deserving recipient of
the Markets Group Strategy Award.
Institutional allocators are welcome to join the
institutional forum at no charge.
For more information on sponsorships and attendance, click here.
