WISCONSIN BLUE BOOK


contributed during the fiscal period being considered. Because the
adjustments are expressed as a percentage of member accounts ex-
clusive of new money contributed during the particular fiscal year,
the amount of the annual adjustment is somewhat magnified. The
degree of magnification will diminish as the funds increase in size.
   Experience in these accounts has been favorable to date with
credits having been made to member accounts as shown in Table
IV.

                              TABLE IV
                              Percentage Increase (or Decrease) effected
in
                              participating member accounts, based on re-
                              spective formulae, all of which exclude current
                              contributions from participation in indicated
                              adjustments
Fund                     Date
                                             Annual Change
State Teachers          6/30/61                  20.4%
Retirement System       6/30/60                   8.9%
Variable                6/30/59                 *15.1%
Wisconsin Retire-       12/31/60                  6.9%
ment Fund              12/31/59                  15.4%
Variable                12/31/58               **36.8%
Milwaukee P.S.          6/30/61                  20.0%
Teachers Annuity        8/31/60                  12.0%
and Retirement          8/31/59
Fund Variable
  *Opening transaction in this fund was transfer from member fixed accounts
as
  of 7/1/58.
  *Opening transaction in this fund was transfer from member fixed accounts
as
  of 1/1/58.
**This fund started with deposits during September 1958, and had no "transfers"
   as of the opening date, and hence no "opening accounts" to which
to credit
   the first year revaluation differential.

   3. Looking at the third listed objective, the board considers its
objective for the Milwaukee teachers separate fund can best be met
by a program designed to increase the value of the assets and earn
as high a return as possible, while recognizing that the fund, at
some future date, will be entirely liquidated. Until statistical pro-
jections of the future pattern are made available to the board, the
investment policy is to put only a small portion of the current net
increase in assets into common stocks comparable to those selected
for the variable annuity funds and to invest the balance in fixed
income securities of moderate maturities.
   4. With respect to objective 4, the board believes it has reached
a maximum result, in that the State Treasurer's balances have
been held at very minimum levels and average amounts invested
have been maintained at highest possible levels for the past several
years. The current program is to keep the operating funds invested
in rather short-time maturities of U.S. government and agency
obligations. The statutes permit investments of up to 5 years.
The benefit derived from maintaining a fairly short maturity
schedule for these investments is cash flexibility, provided without
important market price risk. The State Investment Fund, estab-
lished by the Legislature upon the request of the Investment


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