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Trustees approve replacing RBC international fund with DFA; authorize staff to complete transaction
Summary
After an investment review from Mariner, trustees voted to replace the RBC international equity fund with a Dimensional Fund Advisors option and authorized staff to execute the switch, including using a lower-cost CIT share class if available.
The City of Winter Springs Board of Trustees voted unanimously May 8 to replace the RBC international equity holding with a Dimensional Fund Advisors (DFA) option after a quarterly investment presentation by Mariner and its representative, David West. Trustees also authorized staff to complete the liquidation and to pursue a lower-cost collective investment trust (CIT) share class if available.
"We have no action recommendations from an allocation standpoint right now," David West said during the presentation, but he presented manager screening and recommended moving the international equity sleeve to a manager with more center-court/core characteristics and better historical downside capture than the existing RBC holding.
West summarized the quarter: the fund was roughly down 1.5% fiscal year to date but recovered in April; the portfolio held a slightly elevated cash position and a previously directed rebalancing reduced the RBC international allocation and added funds to a Vanguard short‑term bond fund. He also noted that open‑end real estate managers continue to process modest redemptions and that one manager, Intercontinental Real Estate, had begun to partially address its redemption queue.
Mariner presented several international manager candidates, including Dimensional Fund Advisors (DFA), T. Rowe Price, Transamerica and others. The board focused on down‑capture metrics—that is, how much a manager historically limits losses in down markets—because trustees said preservation of capital in downturns matters to plan funding. West said DFA showed comparatively favorable down‑market capture across multi‑year windows and that the manager runs a very broadly diversified portfolio.
Trustees discussed implementation details, including whether institutional share classes or CIT share classes were available at lower cost. West said indexing is an option but that he favored an active manager for the international sleeve to improve downside capture. The board authorized Mariner and city staff to proceed with the DFA option if a competitively priced share class is available; if a lower‑cost CIT is available, staff was authorized to use it and to coordinate any required trust documents and signatories with city legal counsel and the City Commission.
Board member Michael Blake moved to replace the RBC international fund with the DFA fund; a trustee seconded. The roll call vote was recorded as: Michael Blake—Aye; Brandon Fair—Aye; David Withy—Aye; Vice Chair Fareed—Aye; Chair Marco Santoro—Aye. The motion passed.
Earlier in the meeting West had also provided context about macroeconomic effects on returns, mentioning early effects of tariff-related trade disruptions on supply chains and noting that while international equities were the quarter’s stronger performer, attribution in recent periods had been mixed and specific sector and country exposures (for example, Canada and Ireland in the quarter reviewed) explained parts of the RBC underperformance.
Trustees asked staff to confirm whether the DFA institutional or CIT share class would be available at lower cost and directed staff and Mariner to execute the transition administratively if the operating and legal conditions (including a required trust document for a CIT) could be satisfied without additional Board or Commission action.
