Lone Star Investment Pool January 2025 Performance Update
Comments by Mellon Investments Corp (Dreyfus), Investment Manager
January 31, 2025—After the yield curve steepened in December, US Treasury yields slightly changed in the first month of 2025. The equity markets began the year in positive territory as the Dow Jones Industrial Average, S&P 500, and Nasdaq-100 indexes gained 4.7%, 2.7%, and 1.6%, respectively. As expected, the Federal Open Market Committee (FOMC) held its policy rate steady in a range of 4.25% to 4.50% at the January 29 meeting. The Federal Reserve’s (Fed) preferred inflation metric (core PCE inflation) rose just 0.2% month over month in December and slowed to 2.8% year over year. GDP growth slowed in the fourth quarter to 2.3%. Inventories were a large drag, but personal consumption expanded by 4.2%, the strongest quarterly gain since early 2023 and performed above expectations. The next FOMC meeting is scheduled for March 19. At the end of January, pricing in the fed funds futures market indicated one to two cuts of 25 basis points each by the end of 2025.
Lone Star Investment Pool Active Participants January 2025
- Schools and colleges: 599
- Other Governmental Entities: 92
- Total: 691
Fund Performance
The following fund performance data is as of January 31, 2025.
Government Overnight Fund
Return Information
- Average Monthly Return (a) 4.35%
- SEC 7-day Fund Yield (b) 4.37%
- Weighted Average Maturity One (c) 24 days
- Weighted Average Maturity Two (c) 94 days
- Portfolio Maturing beyond One Year 8%
- Net Asset Value (NAV) $1.00
- Annualized Expense Ratio 0.06%
- Standard & Poor’s Rating AAAm
Investment Distribution
- Agencies 43%
- Cash/Repo 29%
- Treasuries 16%
- Money Market 12%
Total Assets
- Book Value 8,507,508,213.98
- Market Value 8,508,424,607.21
Corporate Overnight Fund
Return Information
- Average Monthly Return (a) 4.56%
- SEC 7-day Fund Yield (b) 4.53%
- Weighted Average Maturity One (c) 49 days
- Weighted Average Maturity Two (c) 73 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 83%
- Cash/Repo 11%
- Money Market 6%
Total Assets
- Book Value 4,357,463,258.48
- Market Value 4,357,702,512.17
Corporate Overnight Plus Fund
Return Information
- Average Monthly Return (a) 4.59%
- SEC 7-day Fund Yield (b) 4.56%
- Weighted Average Maturity One (c) 58 days
- Weighted Average Maturity Two (c) 88 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 94%
- Money Market 3%
- Cash/Repo 3%
Total Assets
- Book Value 13,484,288,864.54
- Market Value 13,485,561,005.02
(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.