1. Los Angeles City Employees Retirement System -LACERS- Emerging Managers Program Allan Emkin, PCA October 6, 2005

2. Los Angeles City Employees Retirement System 2 Implementation Plan Components for a successful program –Statement of Purpose –Staffing –Intent to Develop and Maintain Program Resources –Intent to Implement –Accountability –Tracking and Monitoring –Communications Protocol among the parties

3. October 6, 2005Los Angeles City Employees Retirement System 3 Implementation Plan Statement of Purpose: To support the development of new and innovative initiatives in securities brokerage that will enlarge the landscape of providers, while providing increased opportunities for new firms. To support and promote competition among brokerage firms. To contribute to industry best practices regarding the engagement of new and innovative trading strategies and firms.

4. October 6, 2005Los Angeles City Employees Retirement System 4 Staffing –Review and analyze trading patterns; –Maintain open dialogue with managers and brokers regarding communication protocol and specific manager requirements; –Track filing protocol for reports and broker information; –Schedule forums and other such initiatives. Implementation Plan

5. October 6, 2005Los Angeles City Employees Retirement System 5 Intent to Develop and Maintain Program Resources –Continue to identify firms. –Maintain up-to-date information on firms. Implementation Plan

6. October 6, 2005Los Angeles City Employees Retirement System 6 Intent to Implement Develop understanding and language for investment managers, stating LACERS’ intent to implement and track, based on best practices and subject to best execution : Establish standards for business executed through firms; Actual business executed with firms Verification of manager attempts to trade with firms; Measures to improve manager participation and compliance. Implementation Plan

7. October 6, 2005Los Angeles City Employees Retirement System 7 Accountability –Develop quarterly tracking procedures regarding trading activity –Develop schedule of manager/brokerage forums to encourage exchanges between LACERS, LACERS managers and LACERS brokers. –Develop mechanisms for tracking best execution capabilities of the brokers Implementation Plan

8. October 6, 2005Los Angeles City Employees Retirement System 8 Implementation Plan A sample report:

9. October 6, 2005Los Angeles City Employees Retirement System 9 Implementation Plan In Conclusion… Components for a successful program –Statement of Purpose –Staff –Intent to Develop and Maintain Program Resources –Intent to Implement –Accountability –Tracking and Monitoring –Communications Protocol among the parties