updated April 5, 2017 for the Board of Trustees meeting on April 5, 2017
Presentation and Update Archive
This links to an Adobe Spark presentation with a collection of Economic Data and comments
Endowment Advisory Committee Updates
Performance Review For the Year Ending December 31, 2016
CA Endowment returned 7.6% in 2016, which outperformed the Policy Index return of 5.7%. For the 3-year period (2014 to 2016), Endowment returns have averaged 4.0%, also exceeding the Policy Index Return of 2.9%.
2016 Summary: Good, but Not Enough to Keep Up with Spending Needs
Asset Allocation & Strategy
Committee Remains in a Defensive Posture. The Endowment remains overweight U.S. Stocks as the primary exposure in Equities. In Fixed Income, Committee has reduced its Loan Exposure, and remains heavy in Cash. Regarding Alternatives, the Committee has exited all* Hedge Fund investments in 2016. Instead, we are focusing our Bets on Specific Ideas including MLPs, Energy and Gold.
Minutes From February 7th Meeting:
- Committee reviewed the investment returns, by asset class, and by investment, on full year and Q4 2016 basis. We identified Lazard Strategic International Equity and Matthews Pacific Tiger Fund as holdings which underperformed their respective benchmarks. Committee discussed the best way to manage active fund managers in the Endowment.
- Committee discussed the MLP exposures and decided to maintain our weighting.
- Committee also discussed the Energy (XLE) exposure and discussed its correlation and distinction to the MLP investments
Actions
Committee reduced position in Loan Closed-End Funds and added to exposures in Energy and Gold
- Committee voted to reduce our position in Loan Closed-End Funds (BGT, BSL, FRA, TLI) by one-third
- Committee voted to increase our position in Energy (XLE) to 5.0%
- Committee voted to increase our position in Gold (PHYS) to 5.0%
Q1 2017 Performance Update
Endowment Value = $25,209,744
as of January 31, 2017
Equity
The iShares MSCI ACWI ETF (Ticker "ACWI") is a good proxy for our Equity benchmark. In Q1 2017, ACWI returned +6.9%
- U.S. Active Strategies: Vanguard Dividend Growth Fund +5.9%
- Europe: Lazard International Strategic Equity +5.9% Vanguard FTSE Developed Markets Fund +8.0%
- Asia & Emerging Markets: Matthews Pacific Tiger Fund +12.7% Causeway Emerging Markets +14.3%
Fixed Income
The iShares U.S. Core Aggregate Bond ETF (Ticker "AGG") is our Fixed Income benchmark. In Q1 2017, AGG returned 0.8%.
(FRA) BlackRock Floating Rate Income Strategies +1.4% (BGT) BlackRock Floating Rate Income Trust +2.3% (BSL) Blackstone / GSO Senior Floating Rate Term Fund +0.9% (FRA) Western Asset Management Corporate Loan Fund +0.5% (SAMBX) RidgeWorth Seix Floating Rate High Income +1.4% (LQD) iShares iBoxx Corporate Bond ETF +1.2%