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Beyond total return: using a fiduciary standard to evaluate investment performance.

Government Finance Review

| October 01, 2005 | Finkelstein, Benjamin; Landerman, Felicia | COPYRIGHT 2005 Government Finance Officers Association. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

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, ...

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