Public Equity RFQ - Appendix D - ERS Investment Strategy Description.docx
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- Solicitation number
- 26-15426-001
- Issued by
- Texas
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This document is Appendix D of a Request for Qualifications issued by the Employees Retirement System of Texas (ERS) for Public Equity Investment Advisory Services. The appendix outlines the investment strategy description and evaluation criteria that ERS will apply when reviewing respondent qualifications for managing a Global Equity strategy. The strategy focuses on active, long-only equity investments across all market capitalizations using a core, GARP, or relative value approach with preferred benchmarks including MSCI World, MSCI ACWI, and related indices. Respondents must demonstrate tracking error between 2 and 10 percent and employ fundamental, quantitative, or combined investment approaches.
ERS will evaluate respondent strategies using a two-stage process: pass/fail criteria based on eVestment data parameters followed by numerical scoring of strategies that pass the initial screening. The numerical scoring assessment will analyze firm information including assets under management, ownership structure, and management team composition; strategy information such as active share, fees, inception date, investment style, and number of holdings; risk and return profiles measured by information ratio, batting average, drawdown, and market capture metrics; and portfolio fit capability including the ability to exclude Countries of Concern and correlation alignment with the ERS Public Equity Portfolio. Respondents should reference RFQ Section I for applicable definitions and prepare submissions addressing these evaluation dimensions.
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APPENDIX D
ERS INVESTMENT STRATEGY DESCRIPTION
Appendix D – ERS Investment Strategy Description Page 2 of 2 ERS Public Equity Investment Advisory Services RFQ
APPENDIX D
ERS INVESTMENT STRATEGY DESCRIPTION
Respondent shall reference RFQ Section I for a list of definitions applicable to this appendix.
Strategy
A.1. All Global Equity (eVestment Universe)
Criteria
B.1. Pass/Fail Criteria. ERS will evaluate eVestment data for the following criteria on a pass/fail basis. For this search, ERS will only pass those strategies within the following parameters. A pass for each criterion is indicated by the information in the parentheses.
· Asset Class (Equity);
· Investment Focus (Long Only);
· Portfolio Management Strategy (Active);
· Preferred Benchmark (MSCI World, MSCI World ex-HK, MSCI ACWI, MSCI ACWI ex-CH ex-HK);
· Equity Style Focus (Core, GARP, Relative Value);
· Primary Equity Capitalization (All Cap, Large Cap, Mega Cap, Mid-Large Cap);
· Primary Investment Approach (Fundamental, Quantitative or Combined);
· Tracking error (Between 2 and 10).
B.2. Numerically Scored Criteria. For each strategy that ERS passes on the above criteria, ERS will evaluate the information available (or a derivative of information available) in eVestment and assign a score based on a cumulative analysis of the following criteria:
· Firm Information (Assets under management; Firm structure/ownership; Inception date; Management team);
· Strategy Information (Active share; Assets under management; Benchmark; Fees; Inception date; Investment approach; Investment style; Investment team; Market cap; Number of holdings; Turnover);
· Risk/Return Profile (Batting average; Drawdown; Information ratio; Returns; Standard deviation; Upside/Downside market capture);
· ERS Portfolio Fit (Capability to exclude Countries of Concern; Correlation to ERS Public Equity Portfolio).
Appendix D – ERS Investment Strategy Description Page 1 of 1 ERS Public Equity Investments Advisory Services RFQ
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