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Arrowstreet Capital updates trustees on firm, performance and China overweight
Summary
Arrowstreet Capital presented to the El Paso retirement trust board, outlining firm structure, recent management changes, performance (net value added since inception and Q1 2025), and the persistent overweight to China amid market tariff uncertainty.
Arrowstreet Capital updated the City of El Paso Employees Retirement Trust on its structure, personnel changes and portfolio positioning during the board’s May 21 meeting.
“I'm Colleen Febowicz,” the presenter said, identifying herself as a relationship manager at Arrowstreet Capital. Febowicz described Arrowstreet as a Boston-based global equities manager founded in 1999, managing multiple global mandates from a single, proprietary forecasting model. She told trustees the firm remains organized as a private partnership and has 42 investment partners and about $215 billion in assets under management at the end of the first quarter 2025.
Febowicz reviewed recent personnel changes: two new partners added in October 2024 (Leslie Baccini and Magnus Bjorkman), a retirement of a portfolio leader (Manolis Landikas) succeeded by Brandon Berger, and an announced upcoming retirement of CEO Tony Ryan at the end of 2025 with a board-led CEO search ongoing.
On performance for the mandate covering the trust’s allocation, Febowicz said Arrowstreet delivered a net value add of just over 2% versus the benchmark in 2024 and about a 5% net return versus the benchmark in the first quarter of 2025. Since the trust’s initial investment (nearly five years ago), she said the strategy’s annualized net value add versus the benchmark is nearly 6%.
Trustees asked about Arrowstreet’s persistent overweight to China and its handling of tariff-related volatility. Febowicz described the firm’s forecasts as focused on a short 6–8 week horizon and said the models are updated daily; she characterized the overweight to China (about 9% versus benchmark) as a consistent positioning driven by the firm’s value signals and said Arrowstreet expects to monitor and trade as new information comes in. In response to questions about trading frequency and costs, she said Arrowstreet rebalances roughly four times a week and factors trading costs into decisions, adding, “I to my knowledge, I don't think that that's been, a significant factor for us.”
No board action was recorded on Arrowstreet’s presentation. Trustees thanked Febowicz and indicated they would continue to monitor manager performance through regular reporting.
Febowicz’s specific statements and the board’s questions are reflected in the meeting transcript.
