Investment options and concepts

The Stable Income Fund can provide a reasonable level of interest income with a low risk of principal loss. The Fund only holds fixed income and cash investments and does not own any stock market investments or auction rate securities.

For more information, review the Stable Income Fund profile and our Understanding Stable Income Fund article.

Investing involves risk. You could lose money. And there is no guarantee that investment objectives will be achieved. Asset allocation, rebalancing and diversification do not assure a profit or protect against loss in a down market.

In conformance with the New York State Iran Divestment Act of 2012 (the "Act"), the New York State Deferred Compensation Board (the "Board") hereby establishes the following policy in relation to investments in persons identified by the New York State Office of General Services ("OGS") to be engaged in investment activities in Iran, as defined by the Act.

The Act directs OGS to "develop or contract to develop, using credible information available to the public, a list of persons that it determines engages in investment activities in Iran" as defined by the Act. A person that is identified on the OGS list shall not be deemed to be a responsive bidder or offerer to a State procurement. The first listing of "Entities determined to be non-responsive bidders/offerers pursuant to the New York State Iran Divestment Act of 2012" (the "OGS list") was made available on August 10, 2012.

The Act defines a "person" as:

1. A natural person, corporation, company, limited liability company, business association, partnership, society, trust, or any other nongovernmental entity, organization, or group.
2. Any governmental entity or instrumentality of a government, including a multilateral development institution, as defined in Section 1701(c)(3)of the International Financial Institutions Act (22 U.S.C.262r(c)(3)).
3. Any successor, subunit, parent entity, or subsidiary of, or any entity under common ownership or control with, any entity described in subparagraph one or two of this paragraph.

The Board shall direct each investment manager of an investment offering provided to the participants in the New York State Deferred Compensation Plan (the "Plan") that is subject to a specific set of investment guidelines established by the Board (a "covered investment manager") not to invest in any person included on the OGS list of non-responsive bidders/offerers (which list includes any other person covered by the Act, even if not specifically named on the OGS list). Covered investment managers will include all separate account managers retained to invest the assets of the Plan whose investment mandate requires active (as opposed to passive investment) of Plan assets, including, without limitation, the active investment managers of the Plan’s International Equity Fund and the Stable Income Fund. This policy will not apply to regulated mutual funds that are included as a Plan investment offering, to separate accounts whose mandate is to replicate a published index, to exchange traded funds ("ETFs"), or to collective investment trusts ("CITs").

The Board shall transmit the OGS list to each covered investment manager and direct each covered investment manager to determine if the portfolio it is managing on behalf of the Board (the "Plan portfolio") contains any securities issued by a person included on the OGS list. The Board will direct the covered investment manager to refrain from investing in any security issued by a person included on the OGS list. In addition, the covered investment manager will be required to inform the Board of any currently held securities issued by a person included on the OGS list no later than ten days after such list is provided to the covered investment manager. The covered investment manager will be required to sell all securities issued by a person included on the OGS list and held in the Plan portfolio in a reasonable period of time that will not be disruptive to the Plan portfolio. Such reasonable period shall not be more than 90 days after informing the Board of the securities issued by an entity on the OGS list.

The Act requires OGS to update the list every 180 days. The Board will inform each covered investment manager of any additions to and deletions from the OGS list each time that OGS publishes a new list. The Board will direct the covered investment manager to refrain from investing in any person that is added to the OGS list. The covered investment manager will be permitted to invest in securities issued by a person that has been removed or deleted from the OGS list. The covered investment manager will be required to inform the Board of any currently held securities issued by persons that have been added to the OGS list no later than ten days after such list is provided to the covered investment manager. The covered investment manager will be required to sell all securities issued by such person that are held in the Plan portfolio in a reasonable period of time that will not be disruptive to the Plan portfolio. Such reasonable period shall not be more than 90 days after informing the Board of the securities issued by a person on the OGS list.

Investment managers subject to the Policy should note that the OGS list may not specifically enumerate each person who is a "successor, subunit, parent entity, or subsidiary of, or any entity under common ownership or control with" the person named on the OGS list. However, all such affiliated or associated persons are covered by the Policy and the Act, and it is the responsibility of the asset manager to determine affiliated and associated status with a person named on the OGS list before making an investment in a security.

This policy was initially adopted by the Board on September 14, 2012. The Policy was reviewed and updated on August 23, 2013 and August 20, 2021. The Policy will be reviewed by the Board no later than September 30, 2026.

Excessive trading (also known as frequent trading or market timing) is the practice of buying and selling investments frequently in an attempt to capitalize on short-term movements or pricing disparities in the market. This practice increases fund expenses, which results in higher fees and adversely affects fund performance for all shareholders invested in the fund.

Excessive Trading Policy

Designed to protect participants from the potential negative impacts of market timing, our excessive trading policy imposes a 6/11/20 rule.

If a participant makes six or more trades over one calendar quarter, they will receive a warning letter. If a participant makes 11 trades over two consecutive quarters, the participant must send their exchange requests through the U.S. mail for the remainder of that year. If a participant reaches 20 trades in one calendar year, all future trade requests must be submitted through the U.S. mail for the remainder of that year.

Trading that is deemed excessive may also result in suspension of buy exchange privileges at the request of the mutual fund or by subjective review of the Administrative Service Agency.

International Equity Funds and Emerging Markets Fund Restrictions

A 60-day re-purchase restriction is applicable to both of the Plan’s developed-market International Equity Funds. Participants are permitted to exchange assets from either of the International Equity options, but are not able to re-purchase shares in these funds during the following 60 calendar-days. Direct transfers are not permitted between the International Equity Fund – Active Portfolio and the International Equity Fund – Index Portfolio and an exchange out of either of these fund options will prohibit an exchange into either fund for a 60-day period. The 60-day re-purchase restriction also applies to the Morgan Stanley Emerging Markets Portfolio. Participants are permitted to exchange assets out of the Morgan Stanley Emerging Markets Fund, but are not able to re-purchase shares in this fund during the following 60 calendar-days. Please also refer to the redemption fee information below.

Mutual Fund Redemption Fees

A number of mutual fund companies impose mandatory, fund-specific redemption fees. Plan participants should be aware that the Plan is required to administer redemption fees on behalf of the mutual funds that impose them. A redemption fee is assessed when shares in a mutual fund are bought and sold within a specific timeframe. The Trading Restrictions and Redemption Fees Brochure lists the investment option(s) that currently impose redemption fees. The investment options that impose a redemption fee, the amount of the fee, and the minimum holding period can change at any time.

Many mutual fund companies pay reimbursements to the Plan for administrative functions they would normally perform themselves. Learn more about mutual fund reimbursements.

Get the help you need

If you need more help, call the HELPLINE to speak to your Account Executives.