quarterly investment report ada county june 2019 · rick phillips president & chief investment...
TRANSCRIPT
![Page 1: Quarterly Investment Report Ada County June 2019 · Rick Phillips President & Chief Investment Officer 702-575-6666 rick.phillips@ftnmainstreet.com Tonya Dazzio Chief Operating &](https://reader033.vdocuments.us/reader033/viewer/2022060308/5f0a2bd77e708231d42a5ada/html5/thumbnails/1.jpg)
Client Management Team
Rick Phillips President & Chief Investment Officer 702-575-6666 [email protected]
Tonya Dazzio Chief Operating & Compliance Officer 702-575-6592 [email protected]
Greg Balls, CFA Senior Portfolio Manager 702-575-6655 [email protected]
Dan Rusk Portfolio Manager 702-575-6633 [email protected]
Christine Wilson Operations Analyst 702-575-6640 [email protected]
Ada County
June 2019
10655 Park Run Drive Suite 120 | Las Vegas, NV 89144 | Toll Free 888.278.7350 | www.FTNMainStreet.com
Quarterly Investment Report
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Portfolio Summary
State of Idaho LGIPFederal Home Loan Mtg Corp
Market Value Federal Farm Credit BankBook Value* Federal Home Loan BankVariance U.S. Treasury
Federal National Mtg AssnPar Value Sunwest Bank MMKT Checking
Zions BankNet Asset Value State Of Idaho DBF TR
Ada & Canyon School DistrictsPurchase Yield Ada County
Wells FargoYears to Maturity Univesity of Idaho
Modified Duration
*Book Value is at Original Cost, Not Amortized
#Sector Allocation Key: Agy=Federal Agencies, CD=Cert of Deposit, DBF= State Diversifed Bond Fund, LGIP=State Pool, Mkt Act=Bank Mkt Acct, MMF=Money Mkt Acct, Muni=Municipals, Tsy=Treasuries
$116,590 -$148,667
$181,168,092 $191,861,914
$100.064 $99.922
6/30/19 3/31/19
$181,261,246 $191,618,882 $181,144,656 $191,767,549
2.9% 2.9% 2.8% 2.4% 0.5% 0.1% 0.1% 0.0%
55.7% 13.5% 8.8% 6.9% 3.3%
ACCOUNT SUMMARY PORTFOLIO PURCHASE YIELD HISTORY TOP ISSUERS
Issuer % Portfolio
6/30/2019
SECTOR ALLOCATION# MATURITY DISTRIBUTION CREDIT QUALITY (MOODY'S)
Ada County
2.35% 2.38%
0.55 0.54
0.52 0.51
Agy32.2%
Muni0.7%Tsy
3.3%
LGIP55.7%
DBF2.4%
Zions2.8%
Mkt Acct3.0% 79.2%
11.0%8.5%
0.0% 1.1% 0.1%0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0-1Y 1-2Y 2-3Y 3-4Y 4-5Y 5+Y
55.7%
2.4%
2.8%
3.0%
0.0%
0.1%
0.0%
0.0%
0.0%
0.0%
35.9%
0.0%
0% 20% 40% 60% 80%
NR-LGIP
NR-DBF
NR-Zions
NR-Bank
NR-CD
NR-Ada Co
NR
Aa3
Aa2
Aa1
Aaa
P-1
1.85%
1.95%
2.05%
2.15%
2.25%
2.35%
2.45%
Jul-
18
Au
g-1
8
Sep
-18
Oct
-18
No
v-1
8
De
c-1
8
Jan
-19
Feb
-19
Mar
-19
Ap
r-1
9
May
-19
Jun
-19
NR: Not RatedPer Book ValuePer Book Value
Per Book Value
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Investment Policy Compliance
0.55 Yrs
2.8%
0.7%
2.4%
32.2%
55.7%
0.0%
0.0%
3.0%
0.0%
FTN Financial Main Street Advisors relies on the accuracy of the data provided by Ada County to compile this report.
Yes:50% limit, maximum maturity 5 years. Domiced in the United State, must fall withing FDIC limit. Deposit Accounts in State/Federal
Credit Unions
Collateralized Business Market
Banking Accounts/Time Deposits-
State Depositories
Yes:No limit, maximum maturity 5 years.
Yes:
U.S. Federal Agencies
Idaho Diversified Bond Fund (DBF)
Idaho Local Govt Investment Pool
30% limit,15% issuer limit, maximum maturity 90 days, allowable collateral at 102% of investment,
transacted with Federal Reserve Primary Dealers with rating of A-1, P-1, or F1
Idaho Public Corporations
Repurchase Agreements
Municipal Securities
20% limit, 5% issuer limit, rated A or better by 2 of 3 rating agencies (S&P, Moody's, or Fitch).
Money Market Funds
Yes:
Yes:No limit, maximum maturity 5 years.
Maturity Limits
Parameters In Compliance
Yes
Investment Ratings At time of purchase, all investments must have an A (S&P), A2 (Moody's), or A (Fitch) rating or better. Yes
Maturities of investments must not exceed 5 years, unless unanimous consent of the Board of County
Commissioners is given.
Weighted Average Maturity Weighted Average Maturity (WAM) must be less than 3 years.
U.S. Treasuries
Ada County
50% Limit, 50% issuer limit for State of Idaho Bonds. 20% limit, 10% issuer limit for Idaho Counties,
Cities, Districts, and Education bonds.
70% limit, rated AAA (S&P), Aaa (Moody's), or AAA (Fitch).
No limit, issuer limit 50%, maximum maturity 5 years.
6/30/2019
Yes:
Yes:
Yes:
Yes:
Yes:
70% limit.
Yes:
30% limit.
Item / Sector
3.3%
3
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Historical Book Values
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Avg
FY 13 $167.8 $162.8 $156.6 $198.3 $191.6 $183.9 $182.8 $171.1 $164.4 $196.7 $186.9 $177.0 $178.3
FY 14 $173.6 $162.2 $160.6 $161.5 $191.5 $191.0 $180.0 $175.3 $176.7 $226.2 $192.9 $183.5 $181.2
FY 15 $169.2 $168.1 $156.7 $230.5 $200.3 $193.3 $184.5 $181.9 $176.8 $234.0 $164.9 $153.3 $184.5
FY 16 $140.7 $137.5 $129.7 $258.6 $179.7 $171.4 $158.5 $154.7 $149.0 $221.6 $174.8 $165.7 $170.2
FY 17 $152.2 $148.7 $139.0 $286.6 $191.5 $183.5 $172.8 $169.5 $161.6 $249.1 $186.8 $177.3 $184.9
FY 18 $165.8 $162.0 $152.4 $336.6 $211.6 $201.8 $198.7 $191.7 $181.2 $296.4 $212.8 $200.9 $209.3
FY 19 $185.5 $179.5 $159.3 $287.0 $213.9 $202.1 $190.5 $184.6 $184.5Figures in Millions, Average Daily Balance
6/30/2019 Ada County
$100
$125
$150
$175
$200
$225
$250
$275
$300
$325
$350
Oct
-12
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Mill
ion
s
4
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Historical Book Values by Fiscal Year
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Avg
FY 13 $167.8 $162.8 $156.6 $198.3 $191.6 $183.9 $182.8 $171.1 $164.4 $196.7 $186.9 $177.0 $178.3
FY 14 $173.6 $162.2 $160.6 $161.5 $191.5 $191.0 $180.0 $175.3 $176.7 $226.2 $192.9 $183.5 $181.2
FY 15 $169.2 $168.1 $156.7 $230.5 $200.3 $193.3 $184.5 $181.9 $176.8 $234.0 $164.9 $153.3 $184.5
FY 16 $140.7 $137.5 $129.7 $258.6 $179.7 $171.4 $158.5 $154.7 $149.0 $221.6 $174.8 $165.7 $170.2
FY 17 $152.2 $148.7 $139.0 $286.6 $191.5 $183.5 $172.8 $169.5 $161.6 $249.1 $186.8 $177.3 $184.9
FY 18 $165.8 $162.0 $152.4 $336.6 $211.6 $201.8 $198.7 $191.7 $181.2 $296.4 $212.8 $200.9 $209.3
FY 19 $185.5 $179.5 $159.3 $287.0 $213.9 $202.1 $190.5 $184.6 $184.5 $198.5Figures in Millions, Average Daily Balance
6/30/2019 Ada County
$120
$170
$220
$270
$320
$370
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Mill
ion
s
FY 19
FY 18
FY 17
FY 16
FY 15
FY 14
FY 13
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Purchase YTM Per 6-Month Maturity Intervals
*Based on Book value
4.5 to 5.0+ 5.25% 0.14%
3.5 to 4.0 0.00% 0.00%
4.0 to 4.5 1.95% 1.12%
2.5 to 3.0 1.94% 3.62%
3.0 to 3.5 0.00% 0.00%
1.5 to 2.0 2.16% 8.39%
2.0 to 2.5 2.20% 4.88%
.5 to 1.0 2.27% 9.04%
1.0 to 1.5 1.76% 2.63%
0 to .5 2.44% 70.19%
6/30/2019 Ada County
Years Purchase Yield % of Portfolio*
2.44%
2.27%
1.76%
2.16%
2.20%
1.94%
1.95%
5.25%
1.3%
1.8%
2.3%
2.8%
3.3%
3.8%
4.3%
4.8%
5.3%
-0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5
Pu
rch
ase
Yie
ld
Maturity Intervals
Bubble Size = Maturity's % of Portfolio
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Weighted Average Maturity and Book Yield6/30/2019 Ada County
0.0
0.5
1.0
1.5
2.0
2.5
3.0O
ct-1
2
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Year
s
Weighted Average Maturity History
0.0
0.5
1.0
1.5
2.0
2.5
Oct
-12
De
c-1
2
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
De
c-1
3
Feb
-14
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct
-14
De
c-1
4
Feb
-15
Ap
r-1
5
Jun
-15
Au
g-1
5
Oct
-15
De
c-1
5
Feb
-16
Ap
r-1
6
Jun
-16
Au
g-1
6
Oct
-16
De
c-1
6
Feb
-17
Ap
r-1
7
Jun
-17
Au
g-1
7
Oct
-17
De
c-1
7
Feb
-18
Ap
r-1
8
Jun
-18
Au
g-1
8
Oct
-18
De
c-1
8
Feb
-19
Ap
r-1
9
Jun
-19
Au
g-1
9
Per
cen
t
Month-End Book Yield vs 0-3Yr Treasury Index (24 month moving avg)*
Portfolio
Index
7
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Book Yield per WAM per Percent of Portfolio6/30/2019 Ada County
Agy
LGIP
DBF
Zions*
Muni
Tsy
1.9%
2.0%
2.1%
2.2%
2.3%
2.4%
2.5%
2.6%
2.7%
-1.0 0.0 1.0 2.0 3.0 4.0 5.0 6.0
Yie
ld t
o M
atu
rity
Weighted Average Maturity (Years)
Bubble Size = Percent of Portfolio
*Seperately managed account at Zions Wealth Advisors. WAM is greater than 1 day.
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Interest Rate Shock Analysis
$171,574,499
Portfolio Value Value Change Percent Change
$879,781$642,240$439,890
-$931,533
0.00%
-0.28%
-0.54%
$172,263,834 -$242,198 -0.14%
-$484,397$172,021,635
6/30/2019 Ada County
$173,385,813$173,148,272$172,945,922
0.51%0.37%0.26%
+100 Basis Points
Interst Rate Change
-100 Basis Points-75 Basis Points-50 Basis Points
No Change
-25 Basis Points
+75 Basis Points
+25 Basis Points
+50 Basis Points$171,807,383 -$698,649 -0.41%
$172,725,977 $219,945 0.13%
$0$172,506,032
0.51%
0.37%
0.26%
0.13%
0.00%
-0.14%
-0.28%
-0.41%
-0.54%-0.60%
-0.40%
-0.20%
0.00%
0.20%
0.40%
0.60%
-100BP -75BP -50BP -25BP No Change +25BP +50BP +75BP +100BP
Per
cen
t C
han
ge in
Po
rtfo
lio V
alu
e
Interest Rate Changes/Scenarios
Instantaneous Interest Rate Changes and Estimated Changes in Portfolio's Market Value
9
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Next Twelve Months Maturities
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20
$116.7 $10.5 $0.0 $0.0 $0.0 $0.0 $0.0 $3.0 $0.0 $11.5 $0.0 $2.0
Par Value in Millions. The DBF investment is included in the closest month.
6/30/2019
Maturities
Ada County
$116.7
$10.5
$0.0 $0.0 $0.0 $0.0 $0.0 $3.0
$0.0
$11.5
$0.0 $2.0
$0
$20
$40
$60
$80
$100
$120
$140
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20
Mill
ion
s
10
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Historical Sector Allocation
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19
Agency 30.3% 31.6% 33.1% 36.8% 36.3% 43.4% 30.1% 30.6% 31.1% 33.0% 31.2% 32.2%
Treasury 2.8% 2.9% 3.0% 3.4% 3.4% 4.1% 2.8% 2.9% 3.1% 3.3% 3.3% 3.3%
State of Idaho DBF 2.0% 2.1% 2.2% 2.4% 2.5% 3.0% 2.1% 2.1% 2.2% 2.4% 2.4% 2.4%
State of Idaho LGIP 59.3% 57.7% 55.6% 50.8% 51.1% 41.3% 59.4% 58.7% 57.5% 54.8% 56.6% 55.6%
Municipals 0.6% 0.6% 0.7% 0.7% 0.7% 0.9% 0.6% 0.6% 0.7% 0.7% 0.7% 0.7%
Zions Account 2.4% 2.4% 2.6% 2.8% 2.9% 3.5% 2.4% 2.4% 2.6% 2.8% 2.8% 2.8%
Business Mkt Acct 2.6% 2.7% 2.8% 3.1% 3.2% 3.8% 2.6% 2.7% 2.8% 3.0% 3.0% 3.0%
Certificates of Deposit 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Total 100.0% 100.0% 100.0% 100.0% 100.1% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Sector
6/30/2019 Ada County
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19
AGY
DBF
LGIP
Zions
Bs Mkt Acct
CD
Muni
TSY
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Issuer Allocation6/30/2019 Ada County
0.0%
0.1%
0.1%
0.5%
2.4%
2.8%
2.9%
2.9%
3.3%
6.9%
8.8%
13.5%
55.7%
0% 10% 20% 30% 40% 50% 60%
University of Idaho
Wells Fargo
Ada County
Ada & Canyon School Dist
State Of Idaho DBF
Zions Bank
Sunwest Bank MMKT Checking
Federal National Mtg Assn
U.S. Treasury
Federal Home Loan Bank
Federal Farm Credit Bank
Federal Home Loan Mtg Corp
State Of Idaho LGIP
12
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Historical Earnings and Book Rate of Return Performance
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep$173.7 $334.8 $498.5 $662.6 $832.7 $1,009.8 $1,187.5 $1,357.5 $1,531.6 $1,688.2 $1,853.4 $2,005.5$178.2 $360.4 $496.4 $659.7 $812.5 $979.6 $1,133.8 $1,322.4 $1,540.0 $1,685.4 $1,839.0 $1,997.5$178.6 $349.5 $451.2 $539.4 $633.2 $806.4 $963.4 $1,134.5 $1,228.6 $358.4 $282.8 $270.4$75.9 $146.6 $220.6 $342.3 $375.0 $443.7 $585.9 $691.0 $790.5 $907.3 $1,018.2 $1,104.1
$105.0 $202.6 $296.7 $489.1 $623.2 $760.6 $905.5 $1,043.1 $1,172.7 $1,404.4 $1,565.0 $1,749.5$191.8 $373.9 $539.4 $933.0 $1,184.6 $1,460.3 $1,742.6 $2,031.9 $2,340.3 $2,859.5 $3,224.5 $3,571.1$341.4 $655.2 $940.0 $1,508.8 $1,894.6 $2,297.1 $2,669.9 $3,029.7 $3,414.1
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep2.17% 2.15% 2.13% 2.21% 2.23% 2.25% 2.27% 2.27% 2.30%
Custom Benchmark* 2.21% 2.25% 2.29% 2.31% 2.34% 2.36% 2.37% 2.37% 2.38%-0.04% -0.10% -0.16% -0.10% -0.11% -0.11% -0.10% -0.10% -0.08%
*Benchmark: 12 Month Moving Avg of the 0-3 Year Treasury ICE BofAML Index (G1QA)--Average Builds Over the Fiscal Year Period
Ada County
Variance
Book Rate of Rtn
Fiscal YTD ($000)FY 2013
6/30/2019
Fiscal YTD
FY 2014FY 2015FY 2016FY 2017FY 2018FY 2019
$0
$1,000
$2,000
$3,000
$4,000
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Tho
usa
nd
s
Fiscal Year-to-Date Earnings
FY 2013
FY 2014
FY 2015
FY 2016
FY 2017
FY 2018
FY 2019
2.0%
2.1%
2.2%
2.3%
2.4%
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Book Rate of Return vs Benchmark
Portfolio
Benchmark
13
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Historical Book Rate of Return Performance
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
1.15% 1.09% 0.15% 0.65% 0.95% 1.71% 2.30%
0.23% 0.26% 0.37% 0.58% 0.85% 1.61% 2.38%
0.92% 0.83% -0.22% 0.07% 0.10% 0.10% -0.08%
*Benchmark: 12 Month Moving Avg of the 0-3 Year Treasury ICE BofAML Index (G1QA)--Average Builds Over the Fiscal Year Period
Benchmark*
Variance
6/30/2019 Ada County
Fiscal YTD
Portfolio
0.92%0.83%
-0.22%
0.07% 0.10% 0.10%
-0.08%
-0.5%
0.0%
0.5%
1.0%
1.5%
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
Portfolio vs. Benchmark: Annual Variance
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24
Portfolio vs Benchmark Portfolio
Benchmark
14
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Investment Activity
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-1939 39 39 39 39 38 38 38 38 37 37 39
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-190 0 0 0 0 0 0 0 0 0 0 40 0 0 1 1 0 0 0 1 0 2 20 0 0 1 1 0 0 0 1 0 2 6
Ada County6/30/2019
Purchases
Total Transactions
Positions
Redemptions
0
10
20
30
40
50
60
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19
Po
siti
on
s
Number of Positions at Month End
0
1
1
2
2
3
3
4
4
5
Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19
Nu
mb
er o
f Tr
ansa
ctio
ns
Purchases and Redemptions* (Excluding LGIP, MMF, & Bank Accounts)Purchases
Redemptions
*Redemptions include maturities, calls, and sells
15
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Quarterly Economic and Market Update
June 2019
16
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Economic and Market Update
*Estimates for the current quarter/month, some data are lagged Sources: FTN Main Street and Bloomberg
6/30/19
Item 6/30/19 3/31/19 Change
U.S. Payrolls Monthly Change 224,000 153,000 71,000
Unemployment Rate 3.7% 3.8% (0.1%)
Labor Force Participation 62.9% 63.0% (0.1%)
Effective Fed Funds Rate 2.40% 2.43% (0.03%)
2 Year T-Note 1.76% 2.26% (0.51%)
3 Month T-Bill 2.09% 2.39% (0.30%)
3 Year T-Note 1.71% 2.21% (0.50%)
5 Year T-Note 1.77% 2.23% (0.47%)
10 Year T-Note 2.01% 2.41% (0.40%)
U.S. Fed Debt Avg Yield* 2.52% 2.50% 0.02%
30 Year Mortgage Rate 3.80% 4.08% (0.28%)
1-5 Yr Agency Spread 0.07% 0.06% 0.01%
1-5 Yr A-AAA Corporate Spread 0.51% 0.47% 0.04%
Dow Jones 26,600 25,929 2.6%
S&P 500 2,942 2,834 3.8%
Consumer Price Index YOY* 1.8% 1.9% (0.1%)
U.S. Avg Regular Unleaded $2.72 $2.69 $0.02
Retail Sales YOY* 2.9% 3.8% (0.9%)
Case-Shiller Home Prices YOY* 2.5% 2.6% (0.1%)
Consumer Confidence 121.5 124.2 (2.7)
Gold (per ounce) $1,409.55 $1,292.38 $117.17
Dollar Index 96.13 97.28 (1.15)
17
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Economic and Market Update
* Real Rate (Inflation Adjusted)
Source: Bureau of Economic Analysis
Estimate: Bloomberg's Survey of Economists
As of: 6/30/19
6/30/19
3.0
2.0
-1.0
2.9
-0.1
4.7
3.2
1.7
0.5
0.5
3.6
0.5
3.2
3.2
-1.0
5.1
4.9
1.9
3.3
3.3
1.0
0.4
1.5
2.3
1.9
1.8
1.8
3.0
2.8
2.3
2.2
4.2
3.4
2.2
3.1
1.8 2
.0
1.9
1.8
-2
-1
0
1
2
3
4
5
6
Q3
20
10
Q4
20
10
Q1
20
11
Q2
20
11
Q3
20
11
Q4
20
11
Q1
20
12
Q2
20
12
Q3
20
12
Q4
20
12
Q1
20
13
Q2
20
13
Q3
20
13
Q4
20
13
Q1
20
14
Q2
20
14
Q3
20
14
Q4
20
14
Q1
20
15
Q2
20
15
Q3
20
15
Q4
20
15
Q1
20
16
Q2
20
16
Q3
20
16
Q4
20
16
Q1
20
17
Q2
20
17
Q3
20
17
Q4
20
17
Q1
20
18
Q2
20
18
Q3
20
18
Q4
20
18
Q1
20
19
Q2
20
19
Q3
20
19
Q4
20
19
Q1
20
20
Pe
rce
nt
U.S. GDP (Quarter over Quarter Annualized)*
Estimates
18
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Economic and Market Update
* Real Rate (Inflation Adjusted)
Source: Bureau of Economic Analysis
6/30/19
Estimate: Bloomberg's Survey of Economists
As of: 6/30/19
8.7
8.0
4.1
4.7
-0.6
7.1
2.1
2.1
-0.7
6.9
2.6
2.6
6.1
4.4
5.8
6.5 6.6
2.7
4.9
3.1
0.2
3.3
5.3 5
.6-0
.5 -0.2
5.4
4.6
5.5
3.2
-0.3
2.5
-1.8
4.6
7.2
4.2
3.5
3.5
4.2
3.7
1.9
-0.1
3.5
2.8
4.0
2.7
3.8
4.4 4.5 4
.84
.11
.01
.72
.93
.83
.52
.91
.9-0
.1-2
.52
.61
.62
.21
.82
.5 2.9
1.6
2.2
2.9
2.5
-5
-4
-3
-2
-1
0
1
2
3
4
5
6
7
8
9
19
50
19
52
19
54
19
56
19
58
19
60
19
62
19
64
19
66
19
68
19
70
19
72
19
74
19
76
19
78
19
80
19
82
19
84
19
86
19
88
19
90
19
92
19
94
19
96
19
98
20
00
20
02
20
04
20
06
20
08
20
10
20
12
20
14
20
16
20
18
Pe
rce
nt
U.S. Annual GDP *
1980s 3.2% 1990s 3.2% 2000s 1.9% 2010s 2.3%1960s 4.5% 1970s 3.3%1950s 4.2%
19
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Economic and Market Update
Source: Bureau of Labor Statistics
12 Month Average Job Change 191,750
6/30/19
0
50
100
150
200
250
300
350
400
De
c-1
4
Mar
-15
Jun
-15
Sep
-15
De
c-1
5
Mar
-16
Jun
-16
Sep
-16
De
c-1
6
Mar
-17
Jun
-17
Sep
-17
De
c-1
7
Mar
-18
Jun
-18
Sep
-18
De
c-1
8
Mar
-19
Jun
-19
Tho
usa
nd
s
U.S. Monthly Non-Farm Payrolls Change
2
3
4
5
6
7
8
De
c-1
4
Mar
-15
Jun
-15
Sep
-15
De
c-1
5
Mar
-16
Jun
-16
Sep
-16
De
c-1
6
Mar
-17
Jun
-17
Sep
-17
De
c-1
7
Mar
-18
Jun
-18
Sep
-18
De
c-1
8
Mar
-19
Jun
-19
Pe
rce
nt
Unemployment RatesNevada
U.S.A
California
Idaho
Washington
20
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Economic and Market Update
Source: Bureau of Labor Statistics
6/30/19
128129130131132133134135136137138139140141142143144145146147148149150151152153
Jun
-09
Jan
-10
Au
g-1
0
Mar
-11
Oct
-11
May
-12
De
c-1
2
Jul-
13
Feb
-14
Sep
-14
Ap
r-1
5
No
v-1
5
Jun
-16
Jan
-17
Au
g-1
7
Mar
-18
Oct
-18
May
-19
Mill
ion
s
U.S. Number of EmployedFull-Time and Part-TIme
62.0
62.5
63.0
63.5
64.0
64.5
65.0
65.5
66.0
Jun
-09
Jan
-10
Au
g-1
0
Mar
-11
Oct
-11
May
-12
De
c-1
2
Jul-
13
Feb
-14
Sep
-14
Ap
r-1
5
No
v-1
5
Jun
-16
Jan
-17
Au
g-1
7
Mar
-18
Oct
-18
May
-19
Pe
rce
nt
U.S. Labor Force Participation Rate
21
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Economic and Market Update
Source: Department of Labor and Bloomberg
6/30/19
Weekly Initial Jobless Claims is the actual number of people who have filed for Unemployment benefits for the first time. The following five eligibility criteria must be met in order to file for
unemployment benefits: 1. Meet the requirements of time worked during a 1 year period (full time or not). 2. Become unemployed through no fault of your own (cannot be fired). 3. Must
be able to work; no physical or mental holdbacks. 4. Must be available for work. 5. Must be actively seeking work.
200
250
300
350
400
450
500
550
600
650
700
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
Tho
usa
nd
s
Weekly Initial Jobless Claims (4 Week Moving Average)
22
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Economic and Market Update
*Real: Inflation Adjusted
Source: U.S. Census Bureau Source: Conference Board
6/30/19
-0.6-0.4-0.2
00.20.40.60.8
11.21.41.61.8
22.22.42.62.8
33.23.43.63.8
44.24.44.6
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Pe
rce
nt
U.S. Real* Retail Sales YOY % Change
20
40
60
80
100
120
140
Dec
-08
Jun
-09
Dec
-09
Jun
-10
Dec
-10
Jun
-11
Dec
-11
Jun
-12
Dec
-12
Jun
-13
Dec
-13
Jun
-14
Dec
-14
Jun
-15
Dec
-15
Jun
-16
Dec
-16
Jun
-17
Dec
-17
Jun
-18
Dec
-18
Jun
-19
Ind
ex
Val
ue
U.S. Consumer Confidence
23
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Economic and Market Update
CPIX: Consumer Price Index, excluding food and energy PCEC: Personal Consumption Expenditure Core
Source: Bureau of Labor Statistics and Bureau of Economic Analysis
6/30/19
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Pe
rce
nt
CPI and CPIX YOY % Change
CPI CPIX
0.0
0.5
1.0
1.5
2.0
2.5
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Pe
rce
nt
PCE and PCEC YOY % Change
PCE PCEC
24
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Economic and Market Update
Sources: New (U.S. Census Bureau),Existing (National Assoc. of Realtors)
Source: Case-Shiller Seasonally Adjusted Annual Rate
6/30/19
-6
-4
-2
0
2
4
6
8
10
12
14
Jan
-11
Jun
-11
No
v-1
1
Ap
r-1
2
Sep
-12
Feb
-13
Jul-
13
Dec
-13
May
-14
Oct
-14
Mar
-15
Au
g-1
5
Jan
-16
Jun
-16
No
v-1
6
Ap
r-1
7
Sep
-17
Feb
-18
Jul-
18
Dec
-18
YO
Y P
erc
en
t
Case-Shiller 20 City U.S. Home Price IndexYOY % Increase
200
300
400
500
600
700
800
3.0
3.5
4.0
4.5
5.0
5.5
6.0
Dec
-10
Jun
-11
Dec
-11
Jun
-12
Dec
-12
Jun
-13
Dec
-13
Jun
-14
Dec
-14
Jun
-15
Dec
-15
Jun
-16
Dec
-16
Jun
-17
Dec
-17
Jun
-18
Dec
-18
Ne
w-T
ho
usa
nd
s
Exis
tin
g-M
illio
ns
U.S. New and Existing Home Sales
Existing-Left
New-Right
25
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Economic and Market Update
Source: U.S. Treasury
6/30/19
$9
$10
$11
$12
$13
$14
$15
$16
$17
$18
$19
$20
$21
$22
$23
Jun
-09
Dec
-09
Jun
-10
Dec
-10
Jun
-11
Dec
-11
Jun
-12
Dec
-12
Jun
-13
Dec
-13
Jun
-14
Dec
-14
Jun
-15
Dec
-15
Jun
-16
Dec
-16
Jun
-17
Dec
-17
Jun
-18
Dec
-18
Trill
ion
s
U.S. Federal Debt Outstanding
1.8
1.9
2.0
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
Jun
-09
Dec
-09
Jun
-10
Dec
-10
Jun
-11
Dec
-11
Jun
-12
Dec
-12
Jun
-13
Dec
-13
Jun
-14
Dec
-14
Jun
-15
Dec
-15
Jun
-16
Dec
-16
Jun
-17
Dec
-17
Jun
-18
Dec
-18
Pe
rce
nt
U.S. Treasury Interest Bearing Debt Avg Rate
26
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Economic and Market Update
Fed Funds Anticipated Rate from the June 19, 2019 FOMC Meeting
Source: Bloomberg
6/30/19
1.20
1.40
1.60
1.80
2.00
2.20
2.40
2.60
Jul-
20
19
Au
g-2
01
9
Sep
-20
19
Oct
-20
19
No
v-2
01
9
Dec
-20
19
Jan
-20
20
Feb
-20
20
Mar
-20
20
Ap
r-2
02
0
May
-20
20
Jun
-20
20
Jul-
20
20
Au
g-2
02
0
Sep
-20
20
Oct
-20
20
No
v-2
02
0
Dec
-20
20
Jan
-20
21
Feb
-20
21
Mar
-20
21
Ap
r-2
02
1
May
-20
21
Jun
-20
21
Jul-
20
21
Au
g-2
02
1
Sep
-20
21
Oct
-20
21
No
v-2
02
1
Dec
-20
21
Jan
-20
22
Feb
-20
22
Mar
-20
22
Ap
r-2
02
2
May
-20
22
Jun
-20
22
Pe
rce
nt
Fed Funds vs. Fed's Anticipated Fed Funds Rate (Fed Dots)
Fed's Anticipated Rates
Fed Funds Futures
27
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Economic and Market Update
Source: Bloomberg
Figures may not total due to rounding
3M
Maturity
-0.511.762.262Y
-0.461.932.391Y
-0.332.102.436M
-0.302.092.39
2.41 2.01 -0.40
Change6/28/193/29/19
6/30/19
3Y 2.21 1.71 -0.50
30Y 2.82 2.53 -0.29
5Y 2.23 1.77 -0.47
10Y
1.6
1.8
2.0
2.2
2.4
2.6
2.8
3.0
3M 6M 1Y 2Y 3Yr 5Y 10Y 30Y
Pe
rce
nt
U.S. Treasury Yield Curve Change
6/28/19
3/29/19
-60
-50
-40
-30
-20
-10
0
3M
6M 1Y
2Y
3Yr 5Y
10
Y
30
Y
Bas
is P
oin
ts
Basis Point Change
28
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Economic and Market Update
Source: Bloomberg
6/30/19
-0.25
0.00
0.25
0.50
0.75
1.00
1.25
1.50
1.75
2.00
2.25
2.50
2.75
Jun
-14
Sep
-14
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Pe
rce
nt
U.S. Treasury Yields: 3M and 1Y
1Y
3M
0.00
0.25
0.50
0.75
1.00
1.25
1.50
1.75
2.00
2.25
2.50
2.75
3.00
3.25
Jun
-14
Sep
-14
Dec
-14
Mar
-15
Jun
-15
Sep
-15
Dec
-15
Mar
-16
Jun
-16
Sep
-16
Dec
-16
Mar
-17
Jun
-17
Sep
-17
Dec
-17
Mar
-18
Jun
-18
Sep
-18
Dec
-18
Mar
-19
Pe
rce
nt
U.S. Treasury Yields: 2Y and 5Y
5Y
2Y
29
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Economic and Market Update
Source: Bloomberg
6/30/19
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Jan
-54
Jan
-56
Jan
-58
Jan
-60
Jan
-62
Jan
-64
Jan
-66
Jan
-68
Jan
-70
Jan
-72
Jan
-74
Jan
-76
Jan
-78
Jan
-80
Jan
-82
Jan
-84
Jan
-86
Jan
-88
Jan
-90
Jan
-92
Jan
-94
Jan
-96
Jan
-98
Jan
-00
Jan
-02
Jan
-04
Jan
-06
Jan
-08
Jan
-10
Jan
-12
Jan
-14
Jan
-16
Jan
-18
Jan
-20
Pe
rce
nt
U.S. Treasury Yields 2Yr and 5Yr - Fed Funds Target Rate
5Yr
2Yr
Fed Funds
30
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Economic and Market Update
Source: Bloomberg
6/30/19
Global Treasury Rates
2 Year Yields 5 Year Yields 10 Year Yields
-0.94%
-0.76%
-0.69%
-0.43%
-0.43%
-0.22%
0.22%
0.61%
0.98%
1.47%
1.75%
-4.0% -2.0% 0.0% 2.0% 4.0%
Switzlnd
Germany
France
Spain
Portugal
Japan
Italy
England
Australia
Canada
USA
-0.86%
-0.67%
-0.52%
-0.26%
-0.17%
-0.17%
0.63%
1.01%
1.35%
1.39%
1.77%
-4.0% -2.0% 0.0% 2.0% 4.0%
Switzlnd
Germany
France
Japan
Portugal
Spain
England
Australia
Italy
Canada
USA
-0.55%
-0.33%
-0.16%
-0.01%
0.39%
0.47%
0.83%
1.32%
1.46%
2.01%
2.10%
-2.0% 0.0% 2.0% 4.0%
Switzlnd
Germany
Japan
France
Spain
Portugal
England
Australia
Canada
USA
Italy
31
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Economic and Market Update
*ICE BofAML Index (option adjusted spread vs. Treasury) *ICE BofAML Index (option adjusted spread vs. Treasury)
1-5Yr Non-Callable Agency (GVPB) Corporate A-AAA Excluding Yankee (CVAC)
Source: ICE BofAML Indices
6/30/19
Current Spread is 7 Current Spread is 51
0
50
100
150
200
250
300
350
400
450
500
550
600
650
May
-05
May
-06
May
-07
May
-08
May
-09
May
-10
May
-11
May
-12
May
-13
May
-14
May
-15
May
-16
May
-17
May
-18
May
-19
Bas
is P
oin
ts
Spread: 1-5Yr Agency* vs Treasury
0
50
100
150
200
250
300
350
400
450
500
550
600
650
May
-05
May
-06
May
-07
May
-08
May
-09
May
-10
May
-11
May
-12
May
-13
May
-14
May
-15
May
-16
May
-17
May
-18
May
-19
Bas
is P
oin
ts
Spread: 1-5Yr A-AAA Corporate vs Treasury
32
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Economic and Market Update
*ICE BofAML Index (option adjusted spread vs. Treasury) *ICE BofAML Index (option adjusted spread vs. Treasury)
AAA Rated ABS (R0A1) CMO Agency 0-3Yr PAC (CM1P)
Source: ICE BofAML Indices
6/30/19
Current Spread is 41 Current Spread is 38
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
May
-05
May
-06
May
-07
May
-08
May
-09
May
-10
May
-11
May
-12
May
-13
May
-14
May
-15
May
-16
May
-17
May
-18
May
-19
Bas
is P
oin
ts
Spread: AAA Asset Backed vs Treasury
-150
-100
-50
0
50
100
150
200
250
300
May
-05
May
-06
May
-07
May
-08
May
-09
May
-10
May
-11
May
-12
May
-13
May
-14
May
-15
May
-16
May
-17
May
-18
May
-19
Bas
is P
oin
ts
Spread: 0-3Yr Agency CMO vs Treasury
33
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Economic and Market Update
Source: Bloomberg
6/30/19
-3.7
-1.9
-0.2
0.7 0.7 0.81.4 1.5 1.6 1.8 2.0
2.42.7 2.8 3.0 3.2
3.5 3.84.2 4.2
5.7
9.0
(6)
(4)
(2)
0
2
4
6
8
10
Per
cen
t
Selected Sector Quarterly Total Returns
34
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Economic and Market Update
Source: Bloomberg
6/30/19
-20.1
-10.7
-8.7
-5.8-4.8
1.3 1.32.3
3.6 3.8 4.6 5.36.2
7.7 8.49.7 10.0 10.2
12.0 12.0 12.1 12.3
(25)
(20)
(15)
(10)
(5)
0
5
10
15
Per
cen
t
Selected Sector Year-Over-Year Total Returns
35
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Economic and Market Update
Sources: Bloomberg, FTN Main Street
6/30/19
1.65
1.75
1.85
1.95
2.05
2.15
2.25
2.35
2.45
2.55
3/3
1/1
9
4/3
/19
4/6
/19
4/9
/19
4/1
2/1
9
4/1
5/1
9
4/1
8/1
9
4/2
1/1
9
4/2
4/1
9
4/2
7/1
9
4/3
0/1
9
5/3
/19
5/6
/19
5/9
/19
5/1
2/1
9
5/1
5/1
9
5/1
8/1
9
5/2
1/1
9
5/2
4/1
9
5/2
7/1
9
5/3
0/1
9
6/2
/19
6/5
/19
6/8
/19
6/1
1/1
9
6/1
4/1
9
6/1
7/1
9
6/2
0/1
9
6/2
3/1
9
6/2
6/1
9
6/2
9/1
9
Per
cen
t
5 Year Treasury Note Yield
Lower Inflation Concerns Prevail Over Strong Q1
GDP Print
Global Weakness Concerns Alarm
Investors
Strong Retail Sales
President Trump Imposes 5% Tariff on
Mexico Over Immigration
US Composite PMI Falls to 10 Year Low
Trump Eases Huawei Restrictions
Manufacturing HitsLowest Level Since
2016
China Announces Retaliatory Tariffs
Trump Announces Delay in Tariffs on
Mexico
FOMC Dot Plot Prices in 2019 Rate
Cut
Consumer Confidence Drops
36
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Economic and Market Update
Sources: Bloomberg, FTN Main Street
6/30/19
24,500
25,000
25,500
26,000
26,500
27,000
3/3
1/1
9
4/3
/19
4/6
/19
4/9
/19
4/1
2/1
9
4/1
5/1
9
4/1
8/1
9
4/2
1/1
9
4/2
4/1
9
4/2
7/1
9
4/3
0/1
9
5/3
/19
5/6
/19
5/9
/19
5/1
2/1
9
5/1
5/1
9
5/1
8/1
9
5/2
1/1
9
5/2
4/1
9
5/2
7/1
9
5/3
0/1
9
6/2
/19
6/5
/19
6/8
/19
6/1
1/1
9
6/1
4/1
9
6/1
7/1
9
6/2
0/1
9
6/2
3/1
9
6/2
6/1
9
6/2
9/1
9
Dow Jones Industrial Index
Dow Tumbles as Lower Interest Rates Stoke Fears
on the Economy
IMF Revises Global & US Growth Lower for
2019China Raises Tariff
Rates on US Imports
Retail Sales Beat Expectations
Trade War Intensifies
Trump Imposes 5% Tariff on Mexico
Jay Powell Hints He's Open to a Rate Cut
Market Rallies on Mexico Tariff Resolution
ECB's Dragi States More Stimulus Possible if
Inflation Doesn't Pick-Up
Stocks Move Higher on Hope of a "Fed Put"
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Disclosure
This report represents the opinions of FTN Financial Main Street Advisors, LLC and should not be considered predictive of any future market performance. Opinions are subject to change without notice. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be considered investment advice or a recommendation of any particular security, investment strategy, or investment product.
Although this information has been obtained from sources which we believe to be reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. This is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. All herein listed securities are subject to availability and change in price. Past performance is not indicative of future results, while changes in any assumptions may have a material effect on projected results. Ratings on all securities are subject to change.
FTN Financial Group, FTN Financial Capital Markets, FTN Financial Portfolio Advisors and FTN Financial Municipal Advisors are divisions of First Tennessee Bank National Association (FTB). FTN Financial Securities Corp (FTSC), FTN Financial Main Street Advisors, LLC, and FTN Financial Capital Assets Corporation are wholly owned subsidiaries of FTB. FTSC is a member of FINRA and SIPC—http://www.sipc.org/.
FTN Financial Municipal Advisors is a registered municipal advisor. FTN Financial Portfolio Advisors is a portfolio manager operating under the trust powers of FTB. FTN Financial Main Street Advisors, LLC is a registered investment advisor. None of the other FTN entities including, FTN Financial Group, FTN Financial Capital Markets, FTN Financial Securities Corp or FTN Financial Capital Assets Corporation are acting as your advisor and none owe a fiduciary duty under the securities laws to you, any municipal entity, or any obligated person with respect to, among other things, the information and material contained in this communication. Instead, these FTN entities are acting for their own interests. You should discuss any information or material contained in this communication with any and all internal or external advisors and experts that you deem appropriate before acting on this information or material.
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