Lone Star Investment Pool April 2023 Performance Update
Comments by Mellon Investments Corp (Dreyfus), Investment Manager
April 30, 2023—U.S. Treasury bond yields were mixed in March as yields less than one year were mostly higher and yields on longer bonds were mostly lower. After a volatile March, equity markets were more stable in April, closing the month with modest gains. First Republic Bank was seized by the Federal Deposit Insurance Corporation (FDIC) and sold to JPMorgan. This was after the failures in March of Silicon Valley Bank, Signature Bank and Silvergate Bank. Headline CPI fell by 1% to 5.0% year-over-year, which was a slightly larger decline than was expected. Initial estimates indicated that GDP expanded by just 1.1% in the first quarter, which was slower than estimates and slower than the 2.6% growth in the fourth quarter of 2022. The market is expecting the Federal Reserve to raise the target range to 5.00% to 5.25% at the May 3 Federal Open Market Committee meeting. The market will pay close attention to the statement and press conference for insight on any additional policy changes this year. At the end of April, the federal funds futures market was pricing in approximately a 25% chance of an additional hike and a rate cut by the end of 2023.
Lone Star Investment Pool Active Participants April 2023
- Schools and colleges: 582
- Other Governmental Entities: 82
- Total: 664
Fund Performance
The following fund performance data is as of April 30, 2023.
Government Overnight Fund
Return Information
- Average Monthly Return (a) 4.82%
- SEC 7-day Fund Yield (b) 4.82%
- Weighted Average Maturity One (c) 13 days
- Weighted Average Maturity Two (c) 73 days
- Portfolio Maturing beyond One Year 6%
- Net Asset Value (NAV) $1.00
- Annualized Expense Ratio 0.06%
- Standard & Poor’s Rating AAAm
Total Assets
- Book Value 6,359,800,335.97
- Market Value 6,360,158,320.30
Investment Distribution
- Cash/Repo 47%
- Agencies 39%
- Money Market 10%
- Treasuries 4%
Corporate Overnight Fund
Return Information
- Average Monthly Return (a) 5%
- SEC 7-day Fund Yield (b) 5.02%
- Weighted Average Maturity One (c) 24 days
- Weighted Average Maturity Two (c) 63 days
- Portfolio Maturing beyond One Year 0%
- Net Asset Value (NAV) $1.00
- Annualized Expense Ratio 0.06%
- Standard & Poor’s Rating AAAm
Investment Distribution
- Commercial Paper 84%
- Money Market 9%
- Cash/Repo 5%
- Agencies 2%
Total Assets
- Book Value 4,031,620,331.99
- Market Value 4,030,813,737.12
Corporate Overnight Plus Fund
Return Information
- Average Monthly Return (a) 5.02%
- SEC 7-day Fund Yield (b) 5.04%
- Weighted Average Maturity One (c) 23 days
- Weighted Average Maturity Two (c) 64 days
- Portfolio Maturing beyond One Year 0%
- Net Asset Value (NAV) $1.00
- Annualized Expense Ratio 0.06%
- Standard & Poor’s Rating AAAf/S1+
Investment Distribution
- Commercial Paper 85%
- Money Market 7%
- Cash/Repo 7%
- Agencies 1%
Total Assets
- Book Value 10,626,826,503.40
- Market Value 10,624,799,112.31
(a) The return information represents the average annualized rate of return on investments for the time period referenced. Return rates reflect a partial waiver of the Lone Star Investment Pool operating expense. Past performance is no guarantee of future results.
(b) SEC 7-Day Yield Calculation: Yield=2 [[a-b/cd +1]6 -1]
a - Dividend and interest income
b - Expenses accrued for the period
c - Average daily number of shares outstanding during the period that was entitled to dividends
d - Maximum offering price per share on the last day of the period
(c) The Weighted Average Maturity One calculation uses the industry standard definition of state maturity for floating rate instruments, the number of days until the next reset date. The Weighted Average Maturity Two calculation uses the final maturity of any floating rate instruments, as opined in Texas Attorney General Opinion No. JC0359.