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The nature of public fund investing is unique. As stewards of public moneys, government portfolio managers have the fiduciary responsibility to ensure that investments are suitable. The Wall Street approach to investment management and performance evaluation does not apply to the investment of public funds. But this raises the question: What is the most appropriate measure of investment performance for state and local governments? If it is not Wall Street's total return measure, then what is it? Is it comparison to peers, as some suggest, or is it something totally different?
If we were to ask a room full of public fund managers to rank, in order of importance, ...