Ka Wai Ola - Office of Hawaiian Affairs, Volume 14, Number 10, 1 October 1997 — KA MANAʻO O NĀ KAHU WAIWAI PĀKAHI [ARTICLE+ILLUSTRATION]

KA MANAʻO O NĀ KAHU WAIWAI PĀKAHI

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0HA investments turn profits

AT 0UR Aug. 21 Budget and Finance Committee meeting, money monitor Martha Brown reviewed the first quarter and second quarter performances of our money managers, and the portfolio gains. She indicated to us in her

report that, the second quarter ended with the highest quarterly gain for stocks (+17.5 percent) in the last 10years. Wamings of lower than anticipated corporate earnings were overshadowed by favorable inflation related news. Although money continued to flow into the most familiar large eap homes, small eap stocks (+16.2 percent) recovered smartly from their losses of the ftrst quarter. The bond market rebounded (+37.7 percent)

as the Federal Reserve took no action during the quarter. Yields in general declined by 0.05 percent, offsetting increases in interest rates from the first quarter.

Eight of 0HA's nine investment managers produced returns in the top one-third of their peer groups. The market has been extremely strong because the Fed has not raised interest rates for 29 months: unemployment has been low, as well as inflation, and corporate earnings high. Your Committee on Budget and Finance eontinues to meet with Martha Brown and will do everything possible to maintain our relationshiDS with

|the investment managers. We are looking tbward global markets as well as investments in real estate, i low-risk venture capital investments, and possible partnerships. We must be ever vigilant in our review of i projects and that "due diligence" recommendations aie made to the board. I hope this article gives you some idea of the portfolio's assets and how it is managed. Last but not least is the fact that our portfolio made gains and is producing i

substantial revenues. ■ For a complete list ofmoney allocations, see the chart helow.

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