YouSaid · the spoken record

Wayne Wicker

lines on the record: 84
first: 2018-03-19
most recent: 2018-03-19
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“I'd say there's probably a couple different categories that you got to think about and be sensitive about. I mean, personally, I think you have to be a caring spouse, a devoted parent, a real loyal friend. In the workplace, I really think you have to come in every day with a positive mental attitude and take on problems and turn them into opportunities. And if you can do that with a smile on your face, that's really important. And then I watch at a lot of places like the conference we're at today where you've got a lot of pretty important guys running a lot of money. And, well, I think it's really nice to be important. I think in life it's really more important to be nice. And I think that if more people thought about life that way, it'd be probably a nicer place.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you know, this isn't too philosophical, Ted, but I would say, you know, I've always been a pretty disciplined guy when it comes to athletics and working out. And, you know, I work out probably seven days a week, and I used to run lots of marathons or triathlons or those types of things. But it was only about five or seven years ago when my doctor really asked me about, well, how's your diet and do you get enough sleep? And what I've come to appreciate is diet and rest are probably more important than working out every day. And boy, I wish I would have known that many, many years ago.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Basketball game at halftime. And I would say, you know, when I'm trying to prioritize some of the things that I think are most impressive are some of the things that the folks from Strategis write, those guys are very, very thoughtful in what Jason Trennert and his team do. They give you a perspective that I don't think you see in traditional sell-side research. And I think I always try to balance that out with, you know, a couple of columnists in the FT, you know, whether it's Robin Wigglesworth or John Authors. And I always think the must read is the back page of section one of the FT because there's always something there that as an investor, you're going to learn something on.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“I would say that as I told you earlier, I'd gotten a degree in journalism and communications, and so there's never been a newspaper I don't love. And so if you see my driveway on Saturday mornings, it's littered with the Financial Times and the Wall Street Journal and Barons and New York Times. So there's a lot of newspapers. And I think that I clearly think that you can get a lot of information there. That's pretty common information. I think the problem people have today, there's so much out there. You got to find out and try to prioritize. So I'm always trying to keep something with me all the time because Sir John Templeton, I read a book of his once, and he said that time is so precious that you don't want to waste any moment that you can. And so always have something with you to read, whether it's between appointments or on the train. Heck, I bring stuff to read at my kids back.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, you know, I guess from a very young age, both my mom and dad were professional musicians. And ever since I can remember, my father had a very strong work ethic. He worked three jobs. He was a school teacher during the day. He taught private lessons in the afternoon, and he'd worked professionally at night. And he's done that ever since I can remember. And he's turning 91 this year, and he's finally decided that maybe he's going to retire from that last job. And so I guess if there's anything I can take away from the teachings that my folks have given me by observation, I'd say, you know, it's a strong work ethic and perseverance and really doing something you love.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“1991. Oh, it's okay. And it was their second World Series title in probably six years. And the metrodome was kind of a crummy stadium, but because it was made out of like cement on the sides, the crowd noise was unbelievable, and they compared it to a 747 taking off a runway, and they do the meter on that. So I would say, you know, that was a pretty thrilling experience. But I have to tell you that after living in Boston, we followed the pats at my house as well. And I wasn't at the gut, but it's hard to say that watching the New England Patriots come back in the 2016 Super Bowl 28-3. My entire family goes to bed, and I sit there and watch these guys come back. That was a pretty spectacular comeback in overtime.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Favorite sports moment. So, you know, I have kind of an ideology that says, I always root for the hometown teams of which I've lived. And so I've lived in four or five. But if I had to pick one, Ted, I'm going to pick two. You know, you're a baseball guy. And so I would say one of my favorite moments was when I was living in Minnesota, it was game seven of the World Series against the Atlanta Braves. And that game went ten innings, and the Minnesota Twins won the World Series, one to nothing at the end of ten innings in the Metrodome.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“We actually turned that question on its head a little bit. We do have a lifetime income product. We tend to market it to those that are in their mid to later stages of their career because it has a guaranteed floor, but it has a higher expense ratio because it has an insurance annuity attached to it. For our younger participants, we are very much of the opinion that our target date funds, which we think over the next stage of their development are going to look a lot more like a DB plan. I think if our vision comes to fruition over the next couple of years, you'll look at our target date funds and they will look and feel a lot like different versions of a multi-stage pension fund. And we think that that's a real benefit for participants to have that ability at lower price points, which we always pride ourselves. On.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“We initially put emerging markets into our target date funds, and we did it in the form of ETFs while we were building out the structure. And so as part of the broader asset allocation, Essentially, what we did, we shifted out of those ETFs when we were able to get active in place because we think there is a tremendous opportunity to add value there. And we also added a little bit more from a couple of the other equity sleeves that we had.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, any given year, I have a lot of answers for you on that too. So, you know, nothing's ever perfect. I think that for a number of years, we had a growth fund that just couldn't get out of its way. We finally, after four sets of changes in 13 years, have a growth fund that I think has started to generate really positive returns. But it was probably the bane of my existence for probably a decade. But it's doing really well now.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think probably the greatest success is the team I've been able to build. If you'd had the luxury of having the rest of my team up here, they probably outshined me in this conversation. They are the ones that have built the results that over the last 10 years, more than 70% of our funds have outperformed peer medians. When you think about how that gets compressed with survivor bias, we think that that's a pretty consistent winning opportunity for our participants. You know, I guess the other part of your question is the area that has been”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“For fixtome company managers, because that margin is much thinner. On the equity side, that's a harder call, right? We're running money more on a quant-oriented basis as opposed to the world I grew up in in fundamental analysis and bottom-up stock picking. And so factors are a bigger component of what we're doing there. And I guess the jury is still out. We've been fortunate over long periods of time to have identified some really great managers. The average tenure of an external manager for us is over eight years. We haven't had our internal program in place for eight years yet, so we'll have to come back and talk.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think that's always the dilemma, right, when you have both internal and external management teams. In my experience here, we started out with folks running internal money off our balance sheet. And we watch these guys start this thing in 06, 07, and about two or three years ago funded them with much larger components of money, client money in our stable value fund. You know, it's been a very consistent ride. And so we think that, you know, they're very competitive, especially net of expenses to what you can do externally.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“How do you balance the internal external dynamic in that you hire people internally, they're a little bit more embedded? What happens if your judgment tells you, eh, we could do a little bit better externally net of fees than what these guys are delivering for us?”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Internal asset management capabilities both on the equity and fixed income side there, especially on the trading side of things, technology is becoming a more and more important piece as transaction costs and impact costs are going to be, I think, a game you're always chasing.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, my eyes kind of glaze over when, as we've just shifted into a new risk analytics system, we have someone who's a PhD out of Columbia who runs that thing. I'm the wrong guy to ask about how that is going to work, but I have to tell you that despite the fact that I don't have the acute understanding of how those risk programs are working, I do believe that we are going to have the ability to leverage the output of that, to make better decisions in terms of where our portfolios are, the what ifs on, what if we modified the structures of these portfolios based on some of the computing capability that we probably didn't have eight years ago at the firm. I certainly see that as being one of the areas that we will probably spend a lot of time on. I think, you know, as we're building out our...”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Is there a size where I think exclusively going passive is there? I would say that I still feel like if you structure the portfolio correctly, you can have an edge over long periods of time, not over short periods of time. I think that more and more, however, as we think about net of expense returns to investors, that combination of integrating both passive and active is pretty compelling. And, you know, there's ways to get different return patterns out of a passive portfolio than just indexing on a market cap basis. So there's different ways to achieve that with size, you know, in billion-dollar mandates without completely suggesting that I'm going to be perfectly satisfied with an index-based return less my expenses.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe this is where the active biased in certain situations comes into place where I think that the general consensus for a S&P 500 mandate is go passive. You're never going to add value there. Yet we have a growth and income fund who over five and ten year periods of time ranks in the top 15% and is beaten net of expenses, the S&P 500.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“History would always show that as assets grow alpha that exists slowly shrinks. Is there an asset size for you at some point in time where you say the optimal strategy to cut costs and get the results you need is just to go passive.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Really keeping your eye on the ball. And I think that the people that we think are really successful are just as hungry at age 60 as they were at age 40. And those are the guys that we like to align ourselves with.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“That's the subtle part of it. It doesn't happen in a quarter. It happens over a two or three-year period of time. And all of a sudden, you look back and say, these guys used to have a margin in these types of environments of X, and it's now a fraction of that. Y? Well, in this particular case, one of them is spending a lot more time in his alma mater where he wrote a check for $10 million to have a soccer field named after him. Another one is out where he's one of three partners at a golf course. So he's probably not there Friday, Saturday. Those are the busy days. So he's probably there Tuesday through Thursday. But this business, as you know, is so competitive that, yeah, there's a balance on getting in your own way with...”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's the obvious ones that everyone here has seen, which is over longer periods of time. They're not living up to expectations. They're not performing in the environments that you thought they'd perform, the way you thought they would perform. But I think that as I've gotten on my career, some of the more subtle things that I look for I was involved with a firm like this, where all of a sudden there's a buyout that occurs, or maybe it's a gradual accumulation of wealth. But at some point, you can have a lot of guys in a firm that they still are pretty passionate, but they're passionate four days a week.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“The fees associated with it. So that's the conundrum. And so I don't think that coming back to your original question, are we looking for things differently? No?”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So there's a lot of comfort in the economies that we can provide in terms of driving down costs, whether it's asset management, back office, some of those things. The downside to that is you probably cut off the bottom end of the types of managers that you can hire in terms of you're not going to give a manager that has 700 million AUM a billion dollars. And we have a lot of billion dollar mandates. So I think that we have opportunistically been the first guy on the block to hire a manager. We've done that on occasion. But I wouldn't say that that's the norm. And I wouldn't say that you can do that for really big mandates. We pick and choose our spots, right? And you try to add alpha with a slice, but it has to be a big enough slice to make a difference. And you have to have it with enough money that you're able to drive down.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think that looking at managers, it's not that much different in my mind. I think you're looking for the same things regardless of what pool of assets you're going to run. You're looking for guys that over long periods of time have put in a process and philosophy that is going to be repeatable over long periods of time. It won't work every year, but you think you have a high degree of confidence. So I don't think what we look for in a sub-advisor here is any different than what we would have looked for 20 years ago. We probably are much more sophisticated and have a lot more tools to analyze that, to come to the same conclusion. I think what's different today for us, though, is given the fact that in our industry where price compression, pricing has become so significant, one of the things that we think is an advantage for us over smaller providers is our size.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that a lot of these guys are mission centric, kind of the same mission-centric feel I have for the role I play at ICMA Retirement Corporation. But you get a lot of guys there that whether there's a guy like Gary Brubaker in the state of Washington or the folks here in Virginia, man, they are on it. So they're willing to live in other places, whether it's in Richmond, Virginia, Olympia, Washington, cost of living is lower, and the quality of life they have, I think, is a perfect trade-off for having a really great opportunity to work with huge amounts of money that they might not otherwise have that opportunity to do.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“This guy's a really smart. And so I'm really encouraged when thinking about the public DB sector, for instance, that the level of talent that they've been able to attract is kind of blows your mind. I live in the state of Virginia. I would tell you that that's one of the most sophisticated investment teams. I don't care who you're going to compare them to. Those guys are really strong, and I can name a dozen guys like that I've met throughout the country.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think there is a difference between the public sector and the private sector in that regard, the private sector, obviously you as the shareholder and the management team are on the hook for any liabilities that are there. In the public sector, I think that the backstop would probably be as little as any of us would like it, higher taxes to pay that liability, right? So I think that in that regard, there's a real difference between a private sector DB plan and a public sector DB plan. You know, I used to have a, it wasn't the highest opinion of some of the guys that were involved in the public sector defined benefit business. 30 years ago, I thought, well, I don't think that guy's that right. Today, I would say when you go and talk to, we all as taxpayers should be really encouraged because when you go to talk to most of the leaders on the very large state pension funds today,”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“How far along are we in the evolution of the defined benefit assets for potentially falling short of the liability? So as you laid that out for individuals, there's an assumption that the defined benefits will be there when the time comes. And a lot of times we hear that that isn't going to happen one way or the other, particularly in the public sector. And so how do you think about that sort of existential risk of, well, the financial plans in place, we know what the benefit is, therefore these people are going to be fine when they retire if 10 or 15 years from now all of a sudden the assets aren't of the size they need to be to meet those liabilities.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the beauty in the public And so what we have found when we've modeled out for our target date funds is that for the mid to older components of the population, they have a pretty good safety net behind them. And so it's only the younger generation, you know, probably employees under the age of 25 or 30 for many of these municipalities are not going to have the benefit of that DB. Those are the ones that I think our financial planners have to spend more time educating. But the difference I think today versus, say, 15 years ago with the introduction of target dates, even if a young participant has no clues what they want to do, the target dates can provide a pretty good asset allocate, one-stop shop, not different than what I think risk-based models used to do.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I would say that in the days when I was responsible for a pension fund, like many people here in this room, the investment business was, I think, easier. There were a lot better ways to create alpha. There were a lot of things that people weren't doing that today, really hard net of expenses to generate an outsized rate of return. I mean, you're not going to be investing in timberland in New Zealand and expecting 18 to 20 percent net of fees. So when everything is compressed because of the low interest rates that you referenced earlier, I think that trying to hit those actual rates is a real issue. And now that people have also de-risked a little bit, I'm going to be interested to see as rates rise what the psychological impact of that is as they see the bond port.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think probably our team is growing. And when I started at this firm, I think we had $13 billion and I think I had 12 people on my team. Total assets, AUM of the firm, including administrations, about $55 billion today were running more like $36 billion. tripled the size of the team that I have there and we're still growing. trying to get them acclimated, making sure that we are retaining a lot of the knowledge that we've built over a long period of time. The average tenure on my team is double digits, so we don't have a lot of turnover, but we have a lot of growth. And so that's always a challenge.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“We can't talk about that yet. To be continued, but we have a lot of things that we're working on at the moment. There's little steps that you're taking. We're seeing things like, as I mentioned earlier, we're putting stable value back in as a bond substitute. We think this is a really great time to have stable value, whether it's in your target date funds or in other balanced portfolios, only because as interest rates are rising, you don't have that impact of duration in stable value that you have in intermediate bonds. We will be doing a few other things as well over the coming months that I think are going to help diversify the return sources that we have in our target date funds.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, but not to the magnitude. I think that a general retail investor might have done. While people did move to stable value, it wasn't everybody on one side of the ship.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So we have a benefit that a lot of organizations don't, certainly my former firm didn't have, in the fact that we've got over 200 people out in the field, and their job full-time is to be out working with our participants. So they do a really great job along with our financial planners that are also out in the field that will do, incidentally, financial plans for free for our participants to provide them with a lot of education. And since we serve the public sector, you have people in the firehouses for all three shifts, for instance, all night long, in the city manager's office. They have a dedicated office where people can make appointments and go in. We have a lot of things that we shoot out through the website that are white papers with thematically it's time in the market, not timing the market that is important. So I think that our investor population was pretty well equipped to deal with that.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“We saw a massive shift out of equities into stable value. You know, our stable value fund ranks number one for one, three, five, ten years, and that goes back for a long period of time. So it's one of our flagship products. It has extremely low risk. If you looked at the rest of our funds, we actually did really well relative to our peers. But really well when you're down 20% doesn't feel so great. So we saw a huge shift and in fact between 2008 and probably 2011 we saw about $5 billion shifts from equities into stable value, which doubled the size of our stable value fund.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“We don't see a lot of transition in or out of funds. We have seen recently with markets up dramatically last year a move into equities and out of stable value to a certain extent.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I don't see it quite that way, but there's always roll-ins and rolls out. So often that happens. But I do think that in defined contribution plans, people tend to have a longer time focus. Or maybe it's the fact that they just are busy and they don't take time to make changes very often. Often that works to their advantage if they're inequities. It may work to their detriment if they are risk averse and they're in, say, our stable value fund that's yielding about $235 for a decade. So I don't think that we see quite as much of that. Where you do see it, periods of great volatility in a very short period of time. Our call centers will be overwhelmed for about a week and then it dies down. And our call centers do a fabulous job of making sure that they provide that information. But for the most part,”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think not any different than most of the folks in this room that have a defined contribution plan. I think that they...”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Versus next. We watch that, and I'm totally amazed at where earnings growth rates are for the first quarter now that we've reported everything. But we really take a much more secular viewpoint on how we think about asset allocation.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“One of the things, we talk about market outlook, and I think one of the areas that I find really interesting right now, regardless of where current valuations are, if you look back at a histogram, we have a histogram that I showed our boards a couple weeks ago that was produced by Strategis. And they showed annual returns since 1926. It showed that 74% of the time equities are positive. 59% of the time equities provide investors with greater than 11 to 40 percent rate of return. And so, you know, given the fact that we are looking at time horizons for individuals, even with a target date fund of 2055, we have a pretty long time horizon. And so we don't get as caught up in relative valuations this question.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I know that periodically you and your team create market outlooks. In the last 10 years, I have yet to see a market outlook that didn't say equities are expensive and are not going to meet actuarial rates of return. We all know what bond yields are. I suppose your market outlook is in the vicinity of the same thing.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So stable value has an insurance wrapper associated with it. So it smooths the evaluations over longer periods of time, the duration of the portfolio. And so it provides a very stable crediting rate, but it's only published once a month.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think right off the bat, one of the things that becomes an impediment is if it isn't from a pricing perspective, if you don't have daily pricing, that's a real problem. Even for very, what I would say, low risk assets and, for instance, stable value, stable value is a non-registered product, very low risk. We would love to use it. We couldn't use it when the SEC changed regulations back in 05. But now that we are a CIT, we're going to reintegrate that as a substitute for bonds and reduce the amount of duration risk in the portfolio.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I think we've made great strides over the last 18 months by demutualizing and going to the CITs where you have one less regulatory body that you have to deal with. In my former life, many years I reported to three boards. I reported the corporate board, the trust board, and our Fortiac board. So now we have our trust board and our corporate board. And by the way, our investment committees for those two organizations work together now. And so I think that they've provided greater fluidity for us to, A communicate with them and B, I think that there is a greater appreciation that given the track record, we've been able to develop over 10 to 15 years, that they want to provide greater support in that regard.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“One of the things everyone here wrestles with is this notion of governance and how do you put your best investment ideas forward without the higher ups getting in the way, for lack of a more genteel way of saying it. How does that work in your organization?”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Boards become more sophisticated over time to appreciate that you need greater flexibility. And so I applaud the support we've gotten from the organization in that regard. And I think that while we don't make wholesale changes, there are times where you have to tilt from one to another. And the beauty of the way we design these funds are multi-managed. So you'll have anywhere from two to four managers in any particular fund. And so while they all may follow the same style category in general, they all do it differently and therefore their characteristics will be different.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“So it's a really good point that you raise. And I would say that you're right. With internal management, you do have the ability, if the risk team comes and says, you know, this factor is too heavily weighted or you're light in this area. You can do things to change that. In the situation we find ourselves most of the time, however, you find yourself in a period where you were relying on underlying sub-advisors to stay within those areas that you've designed for them. Now you provide them with enough latitude in their guidelines and over a period of time you may have to be able to shift. But one of the frustrations I found with SEC guidelines was you have those guidelines and you are really tied to that. The Fortiac Board will really hold you feature the fire that you cannot violate some of these very narrow bands that they have. So one of the things we've done, we've broadened the bands. I think our”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“I've changed the way we think about it at the vantage point funds versus when I was, say, at Target Corporation or when we were at Howard Hughes Medical in the fact that there we looked at the portfolio in totality. Here where we have essentially 33 different funds, and I think we have 59 mandates populated within those 33 funds, we think about it differently because each one of them have a style box in which they have to work within. So when we think about portfolio construction, it's not whether or not I can blend large cap and small cap growth and value as much as really how are we going to get the most efficient combination of managers in a particular style box and stay within that style box over longer periods of time, which is maybe one of the more frustrating components of managing to a morning style. Our protocol.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source
“Let's see. I think in the past year, just about every category, right? But over the last five years, hardly any categories. And so I think they run in cycles. I think recently we introduced an emerging markets fund. It took us a little while to get the structure put into place because of some of the things that are unique in emerging markets and clearing, but that is an area that certainly we believe that Active has an advantage over passive. I think that in the fixed income arena, we certainly believe that you can add value regardless of the mandate in the active space there. And I think that we found that there are some ways that strategies that we have, even in conventional asset categories where just because of the dynamics of the industry, there is an embedded opportunity for alpha.”
2018-03-19 · Capital Allocators · Wayne Wicker - Managing for Millions who Matter (Capital Allocators, EP.44) · IDENTIFIED FROM THE TRANSCRIPT · source