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County advisors defend portfolio after WildStar losses; recommend measured corporate allocation
Summary
Advisors to Natrona County presented a Q2 2025 market update and reviewed county portfolios (roughly $51–$55 million under management). They explained earlier losses tied to WildStar pools, described current liquidity and diversification, and recommended cautious increases in corporate-note allocations.
Joan Evans, director with PFM Asset Management, told the Natrona County Board of Commissioners the county’s managed portfolios produced a 1.42% return in the second quarter of 2025, outperforming the benchmark by 14 basis points. The county’s combined holdings total roughly $51–$55 million across longer‑term and liquid pools, Evans said.
Evans told commissioners that market uncertainty — weaker job gains, tariff effects and fiscal pressure — shaped the quarter’s performance and that the board’s recent decision to allow corporate notes into the policy (maximum 20%) had been used selectively. “At the end of Q2 you had 10% corporates; we’re up to about 13% now in Q3,” Evans said, adding the portfolio’s credit quality meets state statute minimums.
Commissioners pressed advisors about earlier losses tied to the state‑run WildStar pools. Commissioner Laird asked bluntly, “Who got our $4 million?” Troy Hunsaker of Peaks Investment Management said the county’s loss was the result of market‑wide moves: managers sold longer‑term bonds bought at very low yields when interest rates rose rapidly, producing realized losses that were distributed to participants. Hunsaker and Evans both said that today the county’s funds are diversified across multiple pools and managed by separate fiduciaries to reduce concentration risk.
On liquidity, Hunsaker said longer‑term Treasuries and agencies remain tradable in active secondary markets, but selling before maturity can crystallize losses depending on market conditions. He recommended keeping a liquid portion (Wyoming Class) for short‑term cash needs while relying on longer‑term holdings for yield.
Evans suggested the board consider gradually raising the corporate allocation toward a comfort threshold (she suggested 25–30% as typical for similar clients) to give portfolio managers more latitude to capture value, but emphasized that any change should respect Wyoming statutory limits on permissible investments.
The board did not take immediate policy action. Commissioners asked staff to return with any necessary policy language and to continue monitoring liquidity needs and market conditions. The advisors said they would provide a written Q3 update to the commissioners.
Sources: Presentation and Q&A with Joan Evans (PFM Asset Management) and Troy Hunsaker (Peaks Investment Management) to the Natrona County Board of Commissioners.
