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Retirement committee hears plan performance, urged to consider switching OPEB ETFs to lower-cost mutual funds
Summary
Committee presenters said the town’s OPEB trust has grown to about $27 million and that replicating the current ETF allocation with institutional mutual funds could cut investment fees from roughly 18 basis points to about 6 bps, after an estimated ~$11,500 in one-time trading costs; presenters recommended discussing the idea with the Board of Finance in October.
The Simsbury Retirement & Benefits Committee was told on Sept. 2 that the town’s pension and OPEB investments posted a strong quarter and that a change in how the OPEB trust is executed could substantially lower fees.
Chris, the meeting’s investment presenter, said federal fiscal developments and persistent inflation remain themes shaping markets, but the near-term returns for the committee’s portfolios were positive. He told the committee the OPEB trust ‘‘is up in the mid upper $20,000,000 range now’’ and that the trust currently uses ETFs with an investment-expense run rate of about 18 basis points.
‘‘We can get that…
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