b'LOS ANGELES FIRE AND POLICE PENSION SYSTEM NOTES TO FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024NOTE 7CASH, TEMPORARY INVESTMENTS, AND OTHER INVESTMENTS (Continued)Investment PolicyThe Board is responsible for adopting an investment policy using the prudent person standard per Article XI, Section 1106 (c) of the City Charter.Investments are made with care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of a like character and with like aims. The Boards adopted allocation policy effective during fiscal years 2025 and 2024 were as follows: Asset Class 2025 2024Large Cap U.S. Equity 23.00% 23.00%Small Cap U.S. Equity 6.00% 6.00%International Developed Equity 18.00% 18.00%Private Equity 15.00% 15.00%U.S. Core Fixed Income 10.80% 10.78%Treasury Inflation Protected Securities (TIPS) 3.50% 3.52%High Yield Bonds 2.20% 2.20%Unconstrained Fixed Income 2.20% 2.20%Global Credit 3.30% 3.30%Private Credit 3.00% 3.00%Real Estate 8.50% 7.00%Real Estate Investment Trusts (REITS) 1.50% 3.00%Private Infrastructure 2.00% 0.00%Commodities 0.00% 2.00%Cash 1.00% 1.00%Total Portfolio 100.00% 100.00% Credit RiskCredit risk is the risk that an issuer or a counterparty to an investment will not fulfill its obligations.The System seeks to maintain a diversified portfolio of fixed income securities in order to obtain the highest total return at an acceptable level of risk within this asset class.56 LAFPP ANNUAL REPORT 2025 41'