CGFO Treasury 2

• Israel bonds
• reg inv co or trust
• OTHER - BY LAW OR RESO
• AAA RATED MM FUNDS
• CD OR SAVINGS ACCTS - QPDS
• DIRECT OBLIG OF US TREAS
• AUTH INV POOLS - SBA

• SBA
• MM IN AAA RATED
• CDS OR SAVINGS - QPDS
• DIR OBLIG OF US TREAS

SWAP TO GET BETTER RATE OK

IF HAD INV BEFORE 218.415, THEN THOSE RULES APPLY

STATUTES TAKE PRIORITY

MUST BE ANNUAL

CDARS - BANK SELLS LARGE INVESTMENT INTO SMALLER DEPOSIT TO INVEST

CERT OF DEP ACCT REG SVC

• SET INVESTMENT OBJECTIVE
• ID & MANAGE INVESTMENT ASSETS
• STAFFING
• INV POLICY
• DEVELOPE CASH FLOWS
• PERFORM BROKER-DEALER DUE DILIG
• IMPL INT CONT
• SEL/PURCH INV
• REC/ACCTGS FOR INV/MONITOR PROTFOLIO/REPORTING

CLEAR & CONCISE

• GOV AUTH - LEGALITY - INV HAS T/B LEGAL
• SCOPE -  
• APPLIC - WHAT FUNDS TO INV 
• EXCLUSIONS - PENSIONS, BOND FUNDS, FOUNDATIONS, ENDOWMENTS - COVERED BY OTHER POLICIES 
• POOLING OF FUNDS - EFFICIENCY,   SAFEKEEPING, ADMIN, ALLOCATE BACK PROPORT 
• ARBITRAGE - INVEST BORROWED $ @ HIGHER RATE

US TREASURY

MITIGATES CREDIT RISK

• MATCH SECURITIES TO CASH NEEDS TO HOLD TO MATURITY TO GET FULL VALUE.
• MITIGATE INT RATE RISK - S/T INVESTMENTS

HOLD TO MATURITY

SECURITIES BOUGHT CAN BE SOLD EASILY - HAVE ACTIVE SECONDARY MKT

SAFETY - CR (DEFAULT) RISK DUE TO LOSS OF BORROWER OR BACKER/INT RATE RISK

SECONDARY TO SAFETY & LIQUIDITY

INT RATE DECLINING & want to protect prin.  SELL OR SWAP

• PRUDENT PERSON RULE
• ETHICS/CONFLICT OF INT
• DELEG OF AUTHORITY

ACTIVITIES THAT COULD CONFLICT W/ PROPER EXEC/MGMT OF INV PROG OR IMPAIR DECISIONS.  DISCLOSE MATERIAL INV. - WHO/WHAT

GOV BODY HAS TO DELGATE AUTH TO PERSON RESP FOR INV

GOV BODY HAS TO DELGATE AUTH TO PERSON RESP FOR INV

CAN HIRE INV MGR OR ADVISOR BUT THEY MUST BE REGISTERED

DISCRETIONARY OR NONDISCRETIONARY

NASD/FINRA CERT - STATE REG/F/S, CERTIFY THEY AGREE TO FOLLOW INV POLICY/INS

DOSN'T HAVE TITLE TO SECURITIES THEY ARE SELLING.  SELL FOR COMMISSION

BID TO BUY SECURITIES FRO SELLER/OFFER SEC FOR SALE TO BUYERS

ISSUER OF SECURITIES.  COMMON ARRANGEMENT OF MKT.

STATE OF FL ONLY - NOT GFOA

LEG BODY CAN REQUIRE INV IN IF IN POLICY

HELD BY DTC UNTIL SALE COMPLETE

• SEP OF TXN AUTH FORM ACCTG
• DVP - CUSTODIAL SAFEKEEPING
• AVOIDANCE OF PHYS DELIV
• CONF OF TXN/WIRES
• DUAL AUTH OF WIRES
• STAFF TRG & MONITORING OF PROC
• DOCUMENTATION
• CLEAR DELEG OF AUTH

HAVE TO HAVE A MASTER REPURCH AGREEMENT TO DO ACC TO STATE - NOT PER GFOA

DON'T NEED IN FL BECAUSE WE HAVE QPDS

• DIVERSIFICATION/ASSET ALLOC 
• COVARIANCE - MEASURE IF SECURITIES MOVE TOGETHER - POS - MOVE TOGETHER, NEG MOVE OPPOSITE
• MAX MATURITIES
• COMPETITIVE BIDS - GFOA DEFINES AS 3

NOT DEFINED - STATUTUE JUST SAYS MUST GET BIDS - NO MIN #

MEASURE OF INT RATE/MKT RISK

MINIMIZES THE TRAINING & LABOR EFFORT TO ATTAIN MKT AVG PORTFOLIO PERF

MONEY MKT, MUTUAL FUNDS

DATES STAGGERED FOR EXTENDED PERIODS, RENEW L/T WHEN COME DUE

SOME LONG/SOME SHORT  NO INBETWEEN

INVEST AS FAR OUT AS YOU CAN

BUY T BILLS EVERY TIME IT IS ISSUED - SELL ONE THAT YOU HAVE & REINV IN NEW ISSUE

INC PROTFOLIO PERF BY EXCEEDING MKT AVG RATE OF RETURN

• MARKET TIMING
• MONEY MKT ARBITRAGES
• OWNGRADE INV QUALITY
• SWAPS
• YIELD CURVE ANALYSIS

• METHODS
• PERF STDS
• MARKING TO MKT - HOW OFTEN DONE

• EFF ROR
• RISK ADJ RET
• TOTAL RET

yield if held to call date

A PASSIVE PORTFOLIO THAT REPRESENTS THE EXPECTED RETURN & EXPECTED RISKS THAT CORRESP TO THE INV OBJ

NOT UNDER GASB 31 - EST FAIR STDS FOR INV IN INT EARNING INV CONTRACTS, INV POOLS, DEBT SEC, EQUITY SEC, OPEN ENDED MUTUAL FUNDS

EXEMPTIONS - WHAT IS NOT IN NEW POLICY

EST FED RESERVE BANKS TO FURNISH ELASTIC CURRENCY, AFFORD MEANS OF REDISC COMM PAPER, EST MORE EFF SUPERVISION OF BANKING IN US & OTHER PURPOSES

TERM X DISCOUNT %/360

NOTE: USES 360 DAYS (FOR TBILL)

$100- DISCOUNT $

DISCOUNT $/DOLLAR PRICE X 365/TERM

• COUPON BEARING
• MATURE 2-30 YRS
• INT PAID SEMIANNUAL
• CREDIT RISK FREE
• CARRY NORMALLY HIGHER ROR THAN BILLS
• BACKED BY FULL FAITH & CR OF US GOVT

• LEVERAGES BORROWED CASH FOR HIGHER YIELDING SECURITIES DUE TO LONGER MATURITIES OR INCREASED RISK
• OR ANY OTHER CASH/LIQUIDITY NEED

• USE TO FINANCE INT'L TRADE
• MATURE IN 270 DAYS OR LESS

SEC RULE 2A-7

NEGOTIABLE CDS

CMO/COLLATERALIZED MORTGAGE OBLIGATIONS

WHAT IS ACCOMPLISHED WHEN BUNDLE ASSETS TOGETHER SO THAT SOLD TOGETHER

T-BILL

SECURITIES SOLD AT $100,000 OR LESS

FIN INSTRUMENT THE VALUE OF WHICH DEPENDS ON, OR IS DERIVED FROM, THE VALUE OF 1 OR MORE UNDERLYING ASSETS OR INDEX OR ASSET VALUES.  HAS NO VALUE ITSELF.

STATED PRICE THAT DERIVATIVE CAN BE BOUGHT OR SOLD AT

BROKER-DEALER.  PROVIDE THAT GOVT PROVIDE ADDL CR ENHANCEMENT.  LEND TO SOMEONE ELSE BKZ DON'T NEED.  CREATES COUNTERPARTY RISK.

SHOCK VALUE

TIME IT TAKES TO PREPARE DEPOSIT

TIME IT TAKES TO GET $ DEPOSITED

TIME IT TAKES TO RECEIVE PAYMENT

BALANCE THAT CAN BE WITHDRAWN OR INVESTED

BALANCE THAT CAN BE WITHDRAWN OR INVESTED

CAN BE USED FOR BANKING FEES/OVERNIGHT

BALANCE TO LEAVE IN ACCT TO OFFSET BANK FEES

TRANSFER EXCESS BALANCES TO 1 ACCT FOR INVESTING

RECONCILES TO 0 BALANCE - CHECK CLEARING ACCT