Essentially, no matter how safe an individual investment appears, or how well it has performed in the past, prudence dictates that you not put all your eggs in one basket.
CalTRUST provides a convenient means for local agencies to diversify their investment portfolios. The CalTRUST Heritage Money Market Fund, rated "AAA" and "Aaa" by Standard & Poor’s (S&P) and Moody's Investors Service (Moody’s), respectively, offers same-day liquidity until 1 p.m. The CalTRUST Short-Term Fund, rated "AA/S1+" by S&P offers next-day liquidity until 1 p.m. and has produced returns slightly in excess of Local Agency Investment Fund (LAIF) on a net basis since its inception almost seven and a half years ago. Finally, for funds that are not part of your daily cash flow considerations – that is for funds not likely to be called upon over the next two – three years – the CalTRUST Medium-Term Fund can provide an incremental increase in dividend income, while providing monthly liquidity.
Taken together, CalTRUST funds offer cities, successor agencies and other local agencies a convenient, cost-efficient means of earning highly competitive returns while increasing the diversification of their portfolios. CalTRUST is a joint powers authority for the investment of local agency funds co-sponsored by the League of California Cities. CalTRUST currently has assets in excess of $1 Billion and more than 130 participant accounts.
For more information about CalTRUST, please visit its website or contact Lyle Defenbaugh, Wells Capital Management at (916) 440-4890 or Dan Harrison, League of California Cities, at (916) 658-8267.