County adviser reports 2025 portfolio return above short-term benchmarks, cites rising long-term yields

Jim Gretch, a financial adviser with Ellers's Investments, told the St. Croix County Administration Committee on June 9 that the county’s investment portfolio is diversified, has an average maturity of roughly 2.2 years and an average duration of about 2.37.

Gretch said the market has shifted in recent months: ‘‘Longer-term rates are moving higher while short-term rates and cash are starting to pay a little bit less,’’ he said, linking the move in part to unrest in the Middle East and rising input costs such as oil. He described the change as a return toward a more normal yield curve and said that is generally positive for fixed-income investors because ‘‘every time you reinvest, you get a raise.’’

On the county’s accounts, Gretch summarized the allocations across treasuries, U.S. government agencies and municipal bonds and said the county’s strategy emphasizes ‘‘safety of principal, liquidity and yield.’’ He reported the portfolio returned 5.08% net of fees in 2025 and said that result exceeds shorter-term alternatives the county might have held during the year.

Committee members asked technical questions about a slide showing maturities and about whether current market levels would make it advantageous for the county to issue bonds. Gretch said St. Croix County’s creditworthiness means there is typically strong demand for its tax‑exempt bonds but cautioned that if the rate environment continues to harden it could raise borrowing costs; he recommended working with municipal advisors to time issuance and to manage arbitrage and other technical considerations.

The presentation closed with Gretch’s description of a measured trading approach: he said the county’s adviser watches short windows of opportunity in a choppy market and staggers purchases to capture favorable yields without overexposing the portfolio.