EBD # Endowment Trustees Report to Executive Board (Long-Term Investment/Endowment Fund)

Transcription

1 EBD # Endowment Trustees Report to Executive Board (Long-Term Investment/Endowment Fund) Rod Hersberger Senior Trustee Sunday April 19,

2 Salient Market Points Exhibit #1 Positive Signs in the Market Indications of strong income growth and higher savings rate Positive trends in payroll growth and jobless claims Pent up demand due to severe winter weather Easy money by European central bank continues Sharply lower world oil prices Potential Market Risks Corporate earnings negatively impacted by stronger dollar Federal Reserve continues to hint at a future rate increase European central banks trying unconventional methods to fight low inflation China s growth rate for 2015 targeted at 7%, its lowest in 25 years Unstable geopolitical events around the world 2

3 $45,000,000 $40,000,000 Market Value and $40,629, % 7.7% Exhibit #2 1.8%* $35,000,000 $30,000,000 $25,000, % 10.9% 8.4% -24.1% 23.8% 12.2% -1.5% 10.5% $20,000,000 $15,000,000 $10,000, *Three months ending

4 Time Weighted Rate of Return Exhibit #3 Opening Contributions Interest Appreciation Closing ROR* ROR* Balance (Withdrawals) Dividends (Depreciation) Balance Period Cumulative March $ 41,857,168 $ (885,474)** $ 90,108 $ (431,898) $ 40,629,904 (0.82%) 1.83% February $ 40,362,294 $ 0 $ 52,116 $ 1,442,758 $41,857, % 2.67% January 2015 $ 40,735,091 $ 13,704 $ 29,144 $ (415,644) $40,362,295 (0.95%) (0.95%) Total $ 40,735,091 $ (871,770) $ 171,368 $ 595,216 $40,629,904 NA 1.83% *Rate of Return **Represents the quarterly settlement of activities between ALA (Division/RT/PPO etc. scholarship & award activities) and the endowment. 4

5 World Market Performance Exhibit #4 - Calendar Year Market S&P 500 Shanghai Comp Nikkei 225 DAX ML US Broad Market Bonds NASDAQ Euro Stoxx Hang Seng Dow Jones -0.3% -2.5% FTSE 100 CAC % 1.7% 3.5% 5.5% Citi World Big Bonds 3.2% 10.1% 15.9% 18.2% 17.8% 22.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 5

6 Manager Allocation and Style Exhibit #5 Manager Value % London Company - Large Cap Core $ 7,270, % Merrill Lynch Personal Advisor* $ 14,617, % Lord Abbett - Convertibles $ 1,252, % IDP - Large Cap Value $ 719, % The Endowment Fund - Alternatives $ 1,301, % IDP - International Value $ 4,318, % ETF Equity Income and Growth $ 7,173, % Loomis Sayles - Fixed Income $ 3,976, % Total $ 40,629, % *MLPA is a platform under which ALA can access different managers in the form of mutual funds and ETF s. There are 8 different managers in this account including the SRI (Socially Responsible Investing) manager Ariel. IDP Institutional Discretionary Portfolio 6

7 Top Five Portfolio Holdings - No Fossil Fuel Holdings - Exhibit #6 London Company Large Cap Core Lord Abbett - Convertibles Kinder Morgan Lorillard General Dynamics Wells Fargo Hasbro Intel Cash Gilead Sciences Yahoo Mylan Labs 7

8 Top Five Portfolio Holdings Con t Exhibit #6a - No Fossil Fuel Holdings - IDP Large Cap Value John Hancock Classic Value Fund Vanguard Mid Cap Value Index Fund Financial Index ETF Cash Wells Fargo IDP International Value JP Morgan International Value Fund Harbor International Fund John Hancock Horizon Diversified International Fund Ishares MSCI EAFE International Equity Index ETF Cash 8

9 Top Five Portfolio Holdings Con t Exhibit #6b - No Fossil Fuel Holdings - Equity ETF Income & Growth Loomis Sayles Fixed Income Industrials Index ETF Financials Index ETF Information Technology Index ETF Consumer Staples Index ETF Consumer Discretionary Index ETF Loomis Sayles Asset-Backed Securities Fund Loomis Sayles High Income Opportunities Fund U.S. Treasury Notes Cash 9

10 Trustee Education The Trustees and the investment portfolio (Endowment Fund) continue to reap the benefits of its continuing education efforts with its exposure to the abundance of investment industry talent available in the investment capital of the world - New York City. As the Trustees continue to gain knowledge of and experience with the investment tools that are available to investors and their suitability for the portfolio, our risk becomes more diverse and the potential for higher returns increases. 10

11 Exhibit 7 Endowment Trustees Meeting Bank of America Building One Bryant Park New York, NY Wednesday, February 18, 2015 AGENDA TUESDAY FEBRUARY 17 TH Marriott Eastside 525 Lexington Avenue New York, NY WEDNESDAY FEBRUARY 18 TH 8:30 9:00 AM Breakfast and Introductions 9:00 9:05 AM Review Agenda & Approve Minutes (9/17/14) R. Hersberger 9:05-10:00 AM Predictions/Perceptions of US Growth and Economic Outlook Dan Suzuki Senior Investment Strategist, Bank of America Merrill Lynch Global Research Long-Term Macro Market View: 5/10/20 years - US - International Factors That Will Influence Future Growth - Societal/Demographic Trends or Shifts - Political Impact on equities vs. Fixed Income Page 1 of 3

12 Exhibit 7 10:00-11:00 AM Private Equity (PE) Investment Management Alternative Investment Management Joe Lohrer and Douglas Ostrover Blackstone Benefits of PE Activity - Performance - Cost Key Considerations for Using PE Candidate Profile for Using PE The Alternatives Landscape Advantages & Benefits of Illiquid Investments Integrating Alternative Investments into an Institutional Portfolio 11:00 11:15 PM ******** Break ********* 11:15-12:15 PM Emerging Markets Investment Management Paul Rodgers Lazard Issues to Consider Optimal Asset Allocation - Class/Style - Region Asset Classes: Outperform/Underperform Strategic vs. Tactical Considerations Factors in Determining Risk Tolerance Market Concerns and Challenges Other Issues to Consider 12:15 1:15 PM ******** Lunch ********* Speaker Discussion Debriefing - Questions & Answers 1:15 1:45 PM Merrill Lynch Portfolio Review R. Bhatia Page 2 of 3

13 Exhibit 7 Current Performance Future Outlook Manager Reviews - Separate Accounts - MLPA s Asset Allocation Review 1:45 2:00 PM **************Break************ 2:00 2:30 PM Timing of Trustee Appointments Trustees Review Executive Board Actions at MW15 Review Current Terms 2:30 2:45 PM Endowment Fund Summary ET #6.3 K. Brown December :45 3:00 PM Other Business R. Hersberger Report to Executive Board Spring Meeting Future Meeting Dates Page 3 of 3