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Governance And Policy | Insights Blog
Best practice for nonprofits is to issue a Request for Proposal (“RFP”) for an investment management partner every market cycle. Typically, that is at least every 7 to 10 years, or as it is...
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Private Capital | Articles
The COVID-19 pandemic continues to impact the world in unprecedented ways. There is still much uncertainty including about when a vaccine will be ready and how schools reopening in the fall will...
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Investment Strategy | Insights Blog
In partnership with the Council on Foundations, the National Center for Family Philanthropy has released Balancing Purpose, Payout, and Permanence: A Strategy Guide. Commonfund Institute is very...
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Diversity | Insights Blog
Commonfund and Commonfund Institute are very happy to contribute to the new report from Intentional Endowments Network (IEN), “Investing in Racial Equity: A Primer for University & College...
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Governance And Policy | Insights Blog
At Commonfund, we believe diverse managers offer clients access to investment talent and valuable investment opportunities and therefore should be explored and invested in. Overlooking the merits of...
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Investment Strategy | Insights Blog
Key takeaways During periods of dislocation in high-quality credit, investors should stay the course within fixed income portfolios and maintain active risk to benefit from the inevitable rebound...
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Governance And Policy | Articles
William Massy has spent his entire career at the intersection of academia and administration, as a microeconomist; professor, dean and CFO at Stanford University; author; and now, an independent...
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Investment Strategy | Insights Blog
Few markets have been as heavily impacted by the onset of the global pandemic as real estate. Real estate is considered a hard asset that “you can touch and feel”, but during a pandemic no one wants...
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Investment Strategy | Articles
The Council on Foundations has acted to support its members, their nonprofit partners, and the people and communities hit hardest by the impacts of COVID-19 by asking members to sign a pledge of...
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Diversity | Insights Blog
Across the United States, citizens are gathering to protest the unjust deaths of George Floyd, Breonna Taylor and Ahmaud Arbery; each of these individuals fell victim to police brutality and racial...
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Investment Strategy | Insights Blog
Risk surrounds us, and for investment fiduciaries it is inescapable if meaningful real returns are to be sought. While risk and return constitute the axes upon which investment portfolios are built,...
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Diversity | Insights Blog
The senseless killings of Ahmaud Arbery, Breonna Taylor and most recently, George Floyd have once again brought the scourge of racism to the forefront of our nation’s conscience. For many Americans,...
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Investment Strategy | Articles
With nearly $1 billion in assets, The California Wellness Foundation (Cal Wellness), is one of California’s largest public health philanthropic institutions. Cal Wellness awards approximately $43...
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Investment Strategy | Insights Blog
A strong private capital program requires consistent, diversified investing over time. It is also necessary to have— or obtain externally— resources for research and due diligence before you invest;...
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Governance And Policy | Insights Blog
As the world continues to grapple with the social, economic, and public health implications of the current COVID-19 crisis, nonprofit organizations and their boards are working tirelessly to...
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Investment Strategy | Insights Blog
With the equity markets retracing some of the losses that occurred in the first calendar quarter of 2020, endowment market values are likely recovering more quickly than we may have feared during the...
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Governance And Policy | Insights Blog
The central document guiding the management of a nonprofit institution’s endowment—essentially, the strategic plan of the investment committee—is the investment policy statement (IPS). The IPS should...
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Governance And Policy | Articles
Intergenerational equity was defined by economist James Tobin in 1974. He wrote, “The trustees of endowed institutions are the guardians of the future against the claims of the present. Their task in...
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Perspectives | Insights Blog
Although the full effects of the COVID-19 pandemic on U.S. nonprofits will not be known for some time there may be something to learn from what we’re seeing in China. China was the first country to...
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Private Capital | Articles
COVID-19 is impacting the world in unprecedented ways. Today, it is estimated approximately 75 percent of the U.S. population or, almost 250 million people, are staying at home. Globally, over 1.5...
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Investment Strategy | Insights Blog
In the ongoing debate about active versus passive investing, conventional wisdom posits that active investing outperforms passive in recessionary or bear market environments. The question is: Will...
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Governance And Policy | Articles
The Commonfund Higher Education Price Index® (HEPI) is an inflation index for colleges and universities. It has been calculated since 1983 and includes inflation data going back to 1961. Commonfund...
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Responsible Investing | Insights Blog
The times we are living in are unprecedented. On March 11th, the World Health Organization (WHO) declared that the spread of COVID-19 constituted a global pandemic. Currently, in the U.S., the virus...
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Governance And Policy | Insights Blog
Six key words – Purpose, Policy, Process, Portfolio, People, and Perspective – form a framework for effective endowment stewardship. As trustees, investment committee members, and senior management...
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Responsible Investing | Articles
In recent years, responsible investing has received mounting levels of attention from all quarters of the investment management field, from institutional investors large and small to global asset...
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Private Capital | Insights Blog
Are you are considering investing directly with a private equity manager? If you opt to go direct, you will be tasked with selecting, managing and disposing the assets entirely on your own. It may be...
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Perspectives | Insights Blog
For the fiscal year ended June 30, 2019, independent schools reported a 5.7 percent return in endowment assets. In this infographic, we report the key highlights from the 2019 Commonfund Benchmarks...
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Responsible Investing | Articles
Sustainable investing, sometimes called environmental, social, and governance (ESG) investing, has been a hotly contested topic for decades, an the debate continues with both supporters and naysayers...
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Investment Strategy | Articles
Instead of just optimizing for skill, why don’t we optimize for luck? Optimize Luck originated in a group discussion I facilitated for the Investment Institute, a membership organization for...
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Investment Strategy | Insights Blog
Over the past decade U.S. equities have consistently outperformed international markets, leading many investors to question the role of non-U.S. equities in their portfolio. While the current cycle...
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Investment Strategy | Insights Blog
On January 16th Commonfund held its first invitational Diverse Manager Day. The day was made possible as a result of the success we had from submissions to the Diverse Manager Portal launched last...
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Private Capital | Insights Blog
Many investors today, particularly nonprofits, are seeking to align their investment portfolio with the mission of their organization. Commonfund is a signatory to the PRI and as part of our...
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Private Capital | Articles
Commonfund recently hosted a talk on evolving private capital opportunities in emerging markets. Mark Hoeing, Head of Private Equity, moderated the discussion, while Aaron Miller, Head of Venture...
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Governance And Policy | Insights Blog
A critically important asset for many nonprofit organizations is their endowment, sometimes referred to by a different name such as long-term investment fund. So important is this pool of financial...
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Investment Strategy | Articles
Dimple Abichandani is Executive Director of the General Service Foundation (“GSF”), a private grantmaking family foundation that dedicates all its resources to bringing about a more just and...
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Private Capital | Insights Blog
During the week of October 14th, 2019 Commonfund Institute hosted our first Forum outside of the United States in Tokyo, Japan. We were honored to be joined by many leading Japanese institutional...
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Diversity | Articles
Many institutions recognize the need for diversity and inclusion on their boards and investment committees. Diverse and inclusive boards can make more effective decisions, design and deliver...
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Investment Strategy | Insights Blog
Institutional investors overseeing long-term pools of capital typically define their strategic asset allocation with specific targets and bands or ranges around those targets, which allow for...
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Private Capital | Insights Blog
This is the third blog in a private capital series based on our guide, “Succeed in Private Capital Investing”. You can see the previous blog here. Having determined the size of your private capital...
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Governance And Policy | Articles
Once an institution decides to pursue the outsourced CIO or investment office option, it usually leads to the creation of a request for proposal, or RFP. Considering that the outsourced model is a...
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Investment Strategy | Insights Blog
In the fall of 2018, Commonfund announced the creation of its Diversity and Inclusion Office with the mission to “intentionally promote and foster inclusion and equity across Commonfund and our...
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Perspectives | Articles
In this Council on Foundations-Commonfund Study of Foundations viewpoint, it's about analyzing and interpreting the data we've collected. What do they tell us? What trends are emerging? How are...
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Investment Strategy | Insights Blog
What is Gender Lens Investing? Gender lens investing has garnered significant traction in the last decade. Broadly speaking, gender lens investing aims to achieve financial returns and benefit...
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Perspectives | Insights Blog
For the year ended December 31, 2018, participating private foundations reported an average return of -5.3 percent while participating community foundations reported an average return of -3.5 percent...
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Governance And Policy | Insights Blog
Tom Hyatt is a partner in the Washington. D.C. law firm of Dentons US LLP and an authority on nonprofit governance. This blog is excerpted from a presentation he made recently at the Commonfund...
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Governance And Policy | Insights Blog
Tom Hyatt is a partner in the Washington. D.C. law firm of Dentons US LLP and an authority on nonprofit governance. This blog is excerpted from a presentation he made recently at the Commonfund...
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Investment Strategy | Insights Blog
Michael Rowland is the Commonfund Institute Summer Intern. He is a rising senior at Case Western Reserve University. He is majoring in Finance and Accounting. What are Diverse and Emerging Manager...
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Diversity | Insights Blog
Girls Who Invest (GWI) is an organization focused on bringing more women into the field of asset management, a goal that Commonfund strongly supports. Every year, GWI invites rising juniors into...
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Governance And Policy | Insights Blog
Christopher K. Merker, PhD, CFA, is a financial advisor and director of Private Asset Management at Robert W. Baird & Co. and an adjunct professor at Marquette University. He is also the co-author of...
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Governance And Policy | Insights Blog
In the last few months, high profile nonprofit institutions have come under intense scrutiny for ethical dilemmas pertaining to the stewardship of resources meant to support mission. This is Part...
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Private Capital | Insights Blog
Building a private capital allocation that makes a difference to your portfolio takes time and dedication. The first step is deciding to make a meaningful allocation to private capital. Then, to...
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Perspectives | Insights Blog
When calculating return targets for an endowment portfolio, a conventional piece of the equation is often the Consumer Price Index (CPI). CPI plus 5% is the common short-hand formula for institutions...
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Investment Strategy | Insights Blog
In Part I of this blog series, “Investment Manager Fees: Out of Sight, Out of Mind”, we discussed our approach to determining the value of an asset manager and how we might calculate a fair price for...
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Perspectives | Insights Blog
In the last few months, high profile nonprofit institutions have come under intense scrutiny for ethical dilemmas pertaining to the stewardship of resources meant to support mission. This is Part Two...
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Perspectives | Insights Blog
As the last week of June approaches, investment stewards begin to prepare for summer – a time for relaxing, reflecting, and reading. We asked faculty members from the Investment Stewardship Academy,...
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Diversity | Insights Blog
In the last few months, high profile nonprofit institutions have come under intense scrutiny for ethical dilemmas pertaining to the stewardship of resources meant to support mission. In a three-part...
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Responsible Investing | Insights Blog
In just two years Commonfund will celebrate its 50th anniversary as a non-profit investment manager for educational endowments, foundations and other tax-exempt investors. Throughout those almost...
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Investment Strategy | Insights Blog
One of the most pressing questions facing fiduciaries is that of investment management fees. We think it is a healthy and necessary discussion, as even small fees can have a big impact on performance...
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Risk Management | Insights Blog
The majority of investors’ attention is often focused on the performance of the funds or managers in their portfolio. And rightfully so. The numbers that appear on statements month after month will...
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Investment Strategy | Insights Blog
Investors have limited control over the returns their portfolios generate. They have more control over their spending. That doesn’t make it easy. Compared to some earlier periods, volatility in the...
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Perspectives | Insights Blog
“When you’ve suffered a complete loss of engine thrust over the largest city in America, you must act quickly and independently to address the developing situation. But, you must also trust in the...
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Outsourced CIO | Insights Blog
The market for Outsourced Chief Investment Officer (“OCIO”) services has boomed over the last decade. Today, OCIO assets under management are by some estimates nearly $1.5 trillion, 2.5 times the...
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Perspectives | Insights Blog
Donor Advised Funds (DAFs) are the fastest growing giving vehicle in philanthropy. The Council on Foundations defines DAFs as: “A type of charitable giving fund that is established by a donor with an...
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Diversity | Articles
The Surprising Outcomes When Diverse Groups and Homogeneous Groups Tackle the Same Problem In late 2018, Commonfund established a Diversity Office with the objective of benefiting from the strengths...
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Perspectives | Insights Blog
As a follow-on to the Commonfund Forum 2019 panel discussion, The Global Economy and the Return of Risk, Richard Fisher, former President and CEO of the Federal Reserve Bank of Dallas, further...
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Private Capital | Insights Blog
The first step of successful private market investing is to learn what private capital is, what its risks and rewards are, and how it differs from public market investing. Private capital provides...
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Perspectives | Insights Blog
Commonfund recently hosted its 21st annual Commonfund Forum in Orlando, Florida. The event brought together institutional investors to engage in a two-day conference to explore cyclical trends and...
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Perspectives | Articles
Fiscal 2009 was an epochal year. In March, the stock market decline wrought by the financial crisis and Great Recession reached its nadir as investors sensed the worst had passed. With the turn in...
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Perspectives | Insights Blog
Schools participating in the Commonfund Benchmarks Study® of Independent Schools (CSIS) for the 2018 fiscal year reported an average return (net of fees) on their endowment assets of 7.4 percent. The...
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Investment Strategy | Insights Blog
On the surface, hiring two (or more) multi-asset managers to manage an entire portfolio may seem like a good idea. Intuitively, it would seem to reduce manager concentration risk, and provide...
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Investment Strategy | Insights Blog
The biggest challenge in implementing any type of responsible investment program is in clearly defining and prioritizing those issues most relevant to an organization. Although it may seem a...
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Private Capital | Insights Blog
Investors participate in private capital markets for two main reasons: to pursue increased investment return and to add portfolio diversification. Even well-informed investors who are experienced in...
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Investment Strategy | Insights Blog
This blog is reprinted with permission by Net Assets, published by the National Business Officers Association (NBOA). The original article can be found here. Investment guidelines enable...
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Governance And Policy | Insights Blog
Commonfund Higher Education Price Index (HEPI) data show that inflation for colleges and universities was 2.8 percent for fiscal year 2018, a decline from last year’s 3.3 percent but higher than the...
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Responsible Investing | Insights Blog
Over the past year the Commonfund investment teams have undertaken research to identify and isolate a new factor associated with the environmental sustainability of a stock (or a portfolio of...
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Responsible Investing | Insights Blog
Commonfund recently launched a Diversity Office, a formal, cross departmental effort focused on diversity and inclusion. The mission of the Commonfund Diversity Office is to intentionally promote and...
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Investment Strategy | Insights Blog
Let’s start with a quick recap of Part 1 of this story, which can be boiled down to three main points: Investors often spend too much for market beta, paying “2 and 20” for hedge funds that deliver...
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Investment Strategy | Insights Blog
At the risk of beating a dead horse, hedge funds are not an asset class. This is especially true in the way in which Commonfund selects and constructs its hedge fund portfolios: focusing...
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Investment Strategy | Insights Blog
Ten years ago Lehman Brothers failed, representing the largest bankruptcy in history, and accelerating a global financial crisis that would knock many non-profit portfolios backward. This came on the...
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Governance And Policy | Articles
Endowments, like the organizations they support, are generally intended to operate in perpetuity. To accomplish this goal, those responsible for endowments—trustees or directors—make decisions based...
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Perspectives | Insights Blog
Fifty-six healthcare organizations participated in the 2016–2017 Commonfund Benchmarks Study® of Healthcare Organizations. These organizations reported an average investable asset pool of $2.1...
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Governance And Policy | Articles
The calamities known as the financial crisis and Great Recession are now a decade in the past. But far from fading into history, the memories remain fresh. And we are reminded of those days regularly...
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Responsible Investing | Insights Blog
The new and newsworthy in this year’s Council on Foundations–Commonfund Study of Investment of Endowments for Private and Community Foundations® (CCSF) is headlined by responsible investing. No other...
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Investment Strategy | Insights Blog
Costs matter. With expectations for lower market returns over the coming years, every basis point of net performance is particularly important. Furthermore, the compounding effect of high fees can...
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Governance And Policy | Insights Blog
Three days after becoming Executive Director of the Commonfund Institute, I found myself at Yale University in New Haven giving welcoming remarks at our annual educational program. Although I will...
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Investment Strategy | Insights Blog
At Commonfund, we aim to build multi-manager, active risk equity portfolios with a clear objective of consistent outperformance versus passive policy benchmarks. Our approach is to take intentional...
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Responsible Investing | Insights Blog
The Challenges of Terminology There are a great many terms referring in some way to practices related to responsible investing: socially responsible investing; mission-related investing; impact...
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Investor Spotlight | Articles
Rust College: Where tomorrow’s leaders are students today In the wake of the Civil War, Rust College was founded in 1866 to provide an education for newly-freed slaves. Located in Holly Springs,...
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Investment Strategy | Insights Blog
Well, the party may finally be over. Like the college dean who shuts down the campus party, the Fed has finally taken away the interest rate punch bowl that investors have enjoyed for so long. It may...
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Investment Strategy | Articles
The benefits of diversity are widely recognized in the work place and among educational institutions and other nonprofits. Yet, the concept of investment management firms that are minority owned and...
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Investment Strategy | Articles
In March, capital markets entered their tenth year of post-crisis recovery. For diversified portfolios, these have been some of the most profitable times, characterized by strong returns, positive...
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Responsible Investing | Articles
The subject of ESG, or investing in accord with environmental, social and governance principles, arose in several sessions at Commonfund Forum 2018. One session, in particular, was devoted to the...
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Private Capital | Articles
After a turbulent period, emerging markets have delivered double-digit returns in recent years. Private investments in emerging markets offer a way to diversify beyond the public markets and, in...
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Investor Spotlight | Articles
Energetic youth in ‘America’s oldest city’. St. Augustine is the oldest continuously occupied European-established settlement in the continental U.S., having been founded in 1565. Flagler College is...
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Investor Spotlight | Articles
Managing investments for missions, ministries and churches. The Missouri Baptist Foundation (MBF) has a noble calling: to support and strengthen the good work of the show me state's ministries,...
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Investor Spotlight | Articles
These Buccaneers pursue a different treasure. There was a time when pirates plied the waters of the Caribbean in the pursuit of gold and other treasure. The Buccaneers mascot of the University of...
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Investor Spotlight | Articles
The Sky's No Limit. It doesn't issue public weather forecasts, but it tracks weather around the globe. It isn't the national hurricane center, but it studies hurricanes as well as other extreme...
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Investor Spotlight | Articles
Hundreds of thousands of plant species are scattered all over the earth, but if the plant world had a headquarters it might be the Fort Worth, Texas home of the Botanical Research Institute of Texas...
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Investor Spotlight | Articles
Founded in 1854, The Lincoln University is the nation's oldest degree-granting institutions for persons of African descent. Lincoln is committed to maintaining a nurturing and stimulating environment...
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Investor Spotlight | Articles
Active minds changing lives. Right-sized, well balanced, with an extensive range of strong academic programs and some enlightening stats that speak to all of it: Western Washington University (WWU)...
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Investment Strategy | Insights Blog
Earlier last year real estate markets received a scare as CMBS spreads widened, particularly in lower rated and more junior tranches. Additionally, one of the most respected U.S. real estate...
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Investment Strategy | Insights Blog
At Commonfund, we scour the globe to find investment managers that we believe have the ability to consistently produce excess returns (alpha) over and beyond their benchmark. But alpha alone is not...
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Diversity | Insights Blog
Commonfund recently hosted its 20th annual Commonfund Forum in Orlando, Florida. The event brought together 400 institutional investors from the U.S., Puerto Rico, the Virgin Islands, Canada, Chile...
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Perspectives | Insights Blog
We recently hosted our 20th annual Commonfund Forum in Orlando Florida. The event brought together institutional investors to engage in a two-day conference to explore cyclical trends and tactical...
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Private Capital | Insights Blog
At the end of the year we sent out a short survey to learn more about investors’ headline concerns about the private capital markets today. Investors also shared their expectations about returns and...
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Perspectives | Insights Blog
For the fiscal year ended June 30, 2017, educational endowments reported a 12.2 percent return as the 10-Year return fell to 4.6 percent. In this infographic, we report the top findings from the 2017...
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Investment Strategy | Insights Blog
Narrow market leadership in the U.S. and Emerging Markets proves challenging for active managers Narrow markets are not uncommon to equity investors. They tend to manifest themselves during the best...
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Governance And Policy | Articles
Every year, the NACUBO-Commonfund Study of Endowments® (NCSE) reports new data—on investment returns, asset allocation, risk management, donations and gifts, and much more. But some data points are...
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Investment Strategy | Insights Blog
With the release of the annual NACUBO-Commonfund Study of Endowments (NCSE) comes the obligatory comparison of 1-year returns. “How did we do relative to the 12.2 percent average return” is a...
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Perspectives | Insights Blog
Despite 12.2 percent return for FY2017, educational endowments report a decline in their 10-Year return while large institutions lead increase in effective spending rate Data gathered from 809 U.S....
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Governance And Policy | Insights Blog
2017’s tax legislation is the latest in a growing list of challenges facing higher education. The new excise taxes on endowment earnings of the largest private universities, coupled with the...
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Governance And Policy | Articles
Since our founding in 1971, a core element of the Commonfund mission has been to provide insights on a broad range of governance, policy and investment challenges. An engaged governing board is...
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Investment Strategy | Insights Blog
Summary TODAY, THERE IS A GOOD DEAL OF HAND WRINGING OVER THE RISK OF RISING RATES. WHILE RISING LONG-TERM RATES COULD BE A HEADWIND FOR CORE FIXED INCOME, AS LONG AS RATES RISE FAIRLY MODESTLY THE...
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Governance And Policy | Insights Blog
It was another taxing weekend (literally) at Commonfund as we digested 1,097 pages of the conference agreement for the tax reform bill (the “Tax Act”) and its implications for our country and for the...
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Governance And Policy | Insights Blog
UPDATE: Since this blog was published there have been further developments related to the Tax Cuts and Jobs Act. Please see our post Tax Cuts and Jobs Act: CPI Plus More for our latest thinking....
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Governance And Policy | Insights Blog
In most Investment Policy Statements there is often a reference to two important, but conflicting, objectives: one, to preserve the purchasing power of the long-term portfolio in real terms, and two,...
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Investment Strategy | Insights Blog
As we progress through calendar year 2017, we have witnessed the continuation of the equity bull market started in 2009. One difference however, is that leadership has turned (finally!) to non-U.S...
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Private Capital | Articles
Investors often ask about the difference between time-weighted return (“TWR”) and internal rate of return (“IRR”). In general, TWR is used by the investment industry to measure the performance of...
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Investor Spotlight | Articles
The dictionary defines a foundation as “an underlying base or support.” Of course, there’s another type of foundation, defined as “funds given for the support of an institution.” Northampton...
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Governance And Policy | Insights Blog
Like nearly everything in the financial markets, risk is cyclical. History repeats itself. The echoes of past crises are always heard in present ones, yet new crises are rarely predicted and not...
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Outsourced CIO | Insights Blog
Once seen primarily as a solution for small institutions with limited resources, outsourcing of the investment management function is now widespread, with a broad range of long-term investors –...
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Investment Strategy | Articles
In a series of articles, we have addressed two recent investment “fatigues” experienced by institutional investors: Active vs. Passive; and Global (ACWI) vs. US benchmarks. In this article, we...
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Perspectives | Insights Blog
For the fiscal year ended December 30, 2016, participating private foundations reported an average return of 6.4 percent while participating community foundations reported an average return of 7.3...
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Responsible Investing | Articles
Introduction In recent years, growing attention has been paid to the use by endowed institutions of so-called responsible investing practices. The three main practices — environmental, social and...
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Investment Strategy | Insights Blog
Leveling the Field in the “Tug of War” Between Active and Passive… Active Equity Manager Universal Objective: Outperform the Passive Alternative It’s undeniable that every active equity manager’s...
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Investment Strategy | Insights Blog
The natural resources sector is often characterized as cyclical, as producers and service providers experience underlying exposure to and commensurate volatility of commodities in the oil and gas,...
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Investment Strategy | Insights Blog
While most institutional portfolios have allocations to investment grade corporate credit, as a strategic allocation high yield and emerging market credit (liquid credit) are sometimes overlooked....
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Risk Management | Insights Blog
Over the last year there has been no shortage of things to keep investors, asset managers, and risk managers concerned. Despite these exogenous shocks most equity markets have continued to shake off...
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Investment Strategy | Insights Blog
Like the build-up of lactic acid in your muscles after a strenuous workout, the underperformance of Morgan Stanley Capital International All Country World index (MSCI ACWI) vs. the Standard & Poor’s...
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Governance And Policy | Articles
Key Insights While opening opportunity to many New York families, the recently enacted Excelsior Scholarship Program will likely stress the financial resources of small private colleges and...
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Investment Strategy | Insights Blog
Few topics get investors’ attention as much as fees. We wouldn’t be human if we all didn’t want to know, in detail, how much something costs. In the world of investing, fees are an even more...
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Investment Strategy | Articles
With many market participants expecting low nominal returns across traditional asset classes in the coming years, the challenge of structuring a portfolio to achieve CPI +5%, or long-term purchasing...
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Investment Strategy | Insights Blog
At Commonfund, we understand the challenge institutions face of maintaining the purchasing power of their endowment. In fact, achieving a rate of return sufficient to cover inflation, distributions...
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Perspectives | Insights Blog
For the fiscal year ended June 30, 2016, educational endowments reported a -1.9 percent return as the 10-Year return fell to 5.0 percent. In this infographic, we report the top findings from the 2016...
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Investment Strategy | Articles
Stuck in the past or ever-evolving? The endowment model gets a hard look eight years into the current market cycle. With core tenets of the endowment model seemingly under stress for the last several...
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Investment Strategy | Insights Blog
The liquidity markets have experienced one of the largest disruptions since the inception of SEC Rule 2a-71 in the early 1970’s. Over the past few months, we have seen a massive shift of investor...
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Perspectives | Insights Blog
We recently hosted our 19th annual Commonfund Forum in San Antonio Texas. The event brought together institutional investors to engage in a three-day conference to explore cyclical trends and...
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Perspectives | Articles
How much does investment management cost? Fiduciaries, donors and stakeholders at endowed institutions have a strong interest in finding a good answer to this question, particularly in this era of...
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Perspectives | Insights Blog
Commonfund recently hosted its 19th annual Commonfund Forum in San Antonio Texas. The event brought together about 450 institutional investors from the U.S, Puerto Rico and Canada to engage in a...
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Investment Strategy | Insights Blog
Nonprofit institutions have the distinct advantage of having the longest time horizon of any investors – often perpetuity. This affords an opportunity to consider investments based on secular trends...
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Investment Strategy | Insights Blog
These industries may seem an odd pairing, but both are in the midst of a disruption-led, industry-wide rationalization process. The two industries share in common a historically evolved “bundling”...
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Perspectives | Insights Blog
As a result of the evolving landscape of the healthcare industry, organizations are increasingly being shaped by pressures affecting both the revenue and expense sides of the income statement. On one...
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Investment Strategy | Insights Blog
Much has been made of the challenges endowment, foundation and nonprofit investors face in achieving a CPI+ five percent return target. One way to improve the probability of attaining this goal is to...
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Governance And Policy | Insights Blog
Successful investing for long-term funds requires a strategic plan. This is true despite – indeed, because of – the fact that the future is unknowable. The plan must be specific, embodying in...
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Investment Strategy | Insights Blog
Mounting cost pressures are forcing small and mid-sized nonprofit healthcare organizations to consider adopting endowment management practices similar to those used elsewhere in the nonprofit sector....
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Governance And Policy | Insights Blog
Endowed institutions differ in their missions, capabilities and resources, and investment policy statements naturally mirror these differences. In that sense, there is no single ‘right’ investment...
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Investment Strategy | Insights Blog
Beginning in the second half of 2015, there was growing caution that started to impact pricing and investment activity in early 2016. This valuation cooling period and subsequent shift in mindset...
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Investment Strategy | Insights Blog
As we have undergone the process of re-underwriting all of Commonfund’s equity managers and funds over the last 6 months, we have tackled anew the age old question of how many funds does one...
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Governance And Policy | Insights Blog
The structure of a board has an important influence on its effectiveness, and being cognizant of these matters is essential to improving a board’s performance. In this article, we’ll discuss four...
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Investment Strategy | Insights Blog
“There are three things that matter in property: location, location, location”. While the age-old adage still holds in many respects, real estate risks, as with the risks associated with all asset...
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Governance And Policy | Insights Blog
Excellent boards are made, not born. Achieving excellence in board governance requires success in four crucial areas: capable leadership, a sound organizational structure, attention to fiduciary...
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Governance And Policy | Insights Blog
Treasury managers face a new challenge to an old problem. Their institutions historically have relied on operating investment income to provide a necessary influx to operating budgets. Prior to 2008,...
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Investor Spotlight | Articles
These words—to protect, preserve and defend—come from the oath of office sworn by the President of the United States. At the Center for Natural Lands Management (CNLM), they refer to an unwritten but...
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Governance And Policy | Articles
How long is the long term? A year ago, private and community foundations appeared to many observers to have recovered from the losses suffered in the 2008–09 global financial crisis. Double-digit...
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Investment Strategy | Insights Blog
It’s not easy being an active equity manager these days. As the chart below depicts, active managers have just come through the worst period for returns in several decades. The chart shows the...
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Outsourced CIO | Insights Blog
Finding the right investment governance model for your institution isn’t about size. In the hyper-competitive world of endowment management, something curious happens when the word used to describe...
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Governance And Policy | Insights Blog
With each state having its own court system, uniformity among the states did not exist. While there was agreement on basic common-law trust principles, variations still emerged. As the American...
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Responsible Investing | Insights Blog
How can you do the most good, with limited resources, when facing enormous problems? That question lies at or near the heart of every decision at a foundation. This is true of the grant dollars which...
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Investor Spotlight | Articles
Fast Philly facts: The city is the site of the first library, hospital, medical school, stock exchange and zoo in the U.S. It’s the only World Heritage City in the U.S. William Penn founded the city...
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Governance And Policy | Insights Blog
Two important laws enacted in the last 15 years have had an impact far beyond the intent of their original authors, causing major, if little-noticed, changes in nonprofit governance. The...
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Investment Strategy | Insights Blog
In the current climate of slow global economic growth and resource constraints at many institutions, integration of ESG considerations in an organization’s investment portfolio may be perceived as a...
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Governance And Policy | Insights Blog
Most institutional investor discussions and actions regarding global warming have been at two ends of the spectrum: either divest from fossil fuels entirely or remain fully invested. A better...
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Investment Strategy | Articles
Active management has struggled for several years, raising questions about whether active management can ever outperform again. Traditional active manager style tilts, like value and size, have...
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Responsible Investing | Insights Blog
Commonfund and the Council on Foundations are thrilled to announce the release of the 2016 Council on Foundations – Commonfund Study of Responsible Investing. It is the largest and most detailed...
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Outsourced CIO | Insights Blog
A Chief Investment Officer’s primary responsibility is to identify and clearly communicate his/her portfolio’s risks to his/her Board, Investment Committee and/or client(s). About eighteen months...
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| Articles
In the static low-rate environment of recent years, it seemed as though there was no “what’s next” for cash. Today, that has changed, as there are major forces reshaping the regulatory and interest...
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Governance And Policy | Insights Blog
Discussions about whether responsible investing strategies help or hurt investment performance are complicated by the fact that, there are several broad categories of responsible investing practice...
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Governance And Policy | Insights Blog
An operating charity in the Northeast is in the process of implementing a risk-based investment policy for its $30 million endowment. The organization’s seven-member Investment Committee includes...
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Outsourced CIO | Insights Blog
There are three main factors an institution will need to weigh in deciding if working with an OCIO provider is right for them. Those are: Degree of Discretion: What role do the institution’s board...
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Investment Strategy | Articles
Advances in alternative energy technologies promise to reduce the world’s dependence on fossil fuels. Largely, however, they remain just that—a promise. So, where are the opportunities to invest in...
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Responsible Investing | Insights Blog
The terms socially-responsible investing (SRI), mission-related investing, impact investing and environmental, social and governance (ESG) investing – all frequently grouped under the heading of...
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Investment Strategy | Articles
Reprinted from Institutional Investor’s Alpha Spring 2016 issue The growth of the hedge fund industry over the past decade has been tremendous, with more and more institutional and retail investors...
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Governance And Policy | Articles
Most things function a lot better when all the moving parts work together—nonprofit institutions included. The synergies afforded by collaboration across organizational boundaries may be the most...
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Investment Strategy | Articles
Reprinted from Volume 17, Number 1, 2016 of The Journal of Investment Consulting by Mark J.P. Anson Private assets such as private equity and venture capital have long been a thorn in the side of...
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Governance And Policy | Insights Blog
Outsourced investment management, once primarily a solution for small institutions with limited resources, is now used by a broad range of long-term investors. When properly implemented, outsourcing...
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Investment Strategy | Articles
Investors poured $2 trillion into emerging economies between 2009 and 2014. Then prices for a basket of commodities fell—dragging crude oil down to levels not seen in a decade and dashing investors’...
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Investment Strategy | Insights Blog
It’s straightforward to get an answer to that question, at least superficially: draw at random from a manager universe, build hypothetical portfolios with the selected managers, track performance,...
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Governance And Policy | Insights Blog
Currency risk can best be described as the surprise impact that currency exposure has on an investment portfolio. Although currency risk typically confounds investors, it is easy to measure – it is...
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Investment Strategy | Articles
Asset allocation is still the foundation on which better risk-adjusted returns are built. But asset allocation has changed, along with all the associated tools for pursuing return and managing risk....
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Perspectives | Articles
How long is the long term? A year ago, endowments appeared to many observers to have recovered from the losses suffered in the 2008-09 global financial crisis. Double-digit investment returns had...
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Responsible Investing | Insights Blog
A number of clients and prospects have asked how their Investment Policy Statement (IPS) can be amended to accommodate responsible investing strategies. In response, we have prepared a rider which...
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Governance And Policy | Insights Blog
“Outsourced CIO” (or OCIO) is a term that might not be familiar to many. In the past it has been defined as a traditional consulting model in which the process of interviewing potential investment...
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Governance And Policy | Insights Blog
Developments in world financial markets seem to occur more quickly every year, requiring ever-higher levels of expertise and experience on the part of investment committees. Climate change is a more...
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Investment Strategy | Insights Blog
Assets under management (AUM) among hedge funds has always been characteristically top-heavy, with the majority of capital in the hands of a relatively small number of managers. While the hedge fund...
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Governance And Policy | Insights Blog
The following methodology may be of use in helping you to understand more fully what your organization pays for investment management costs. Identify the fees you pay at the overall portfolio level...
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Risk Management | Insights Blog
Our research at Commonfund has found that a 70/30 stock/bond portfolio has north of 99 percent of its risk, as measured by standard deviation, allocated to equities. Thus, portfolio risk typically...
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Outsourced CIO | Insights Blog
Nearly all CFOs and investment committees consider it. And more than ever are acting upon it: investigating the possibility of an Outsourced CIO (OCIO) to manage their institution’s investments. The...
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Risk Management | Insights Blog
Merriam-Webster’s defines risk as the “possibility of loss or injury.” The financial profession — borrowing from Modern Portfolio Theory — uses the standard deviation of a portfolio’s returns to...
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Responsible Investing | Articles
Impact investing is showing growth around the world. According to the most recent J.P. Morgan/Global Impact Investing Network Impact Investor Survey, the number of institutional investors engaging in...
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Governance And Policy | Insights Blog
Recently, Commonfund convened an expert panel of investment managers to hold a roundtable discussion and take a closer look at the different impact investing strategies being implemented today. The...
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Governance And Policy | Articles
It is often said that we live in a world of change, but it is surprising how slowly that change can occur. Seven years after the onset of the Great Recession, many business school students are still...
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Outsourced CIO | Articles
The design axiom captures the purpose of multi-asset investing Interest in multi-asset investing is growing and the inflows confirm it: Institutional assets committed to multi-asset investing are...
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Outsourced CIO | Articles
Nearly all CFOs and investment committees consider it. And more than ever are acting upon it: investigating the possibility of an Outsourced CIO (OCIO) to manage their institution’s investments. When...
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Private Capital | Articles
What and Why An article in the previous issue of Insight sought to discern the difference between perception and reality in private equity investing generally, and included a companion article...
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Perspectives | Articles
For investors building multi-manager portfolios, a look at an alternative hedge fund beta. Approaches to stock selection vary widely across the hedge fund universe, even among managers practicing the...
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Risk Management | Articles
Investment returns of less well-diversified portfolios have flourished in the accommodative market environment created by central banks. But what will happen when rates rise? In the last five years,...
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Perspectives | Articles
On campus, the thinking about operating asset management is changing with the times. In the wake of the 2008 financial crisis and Great Recession, liquidity was the primary concern on university...
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Governance And Policy | Insights Blog
Generally speaking, Environmental Social and Governance, or ESG for short, is used to describe a group of characteristics that can have a material impact on the long-term success of a company and,...
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Governance And Policy | Articles
Commonfund recently convened an expert panel moderated by Myra Drucker (standing, left), Chair of the Board, TrustedPeer Inc. and former chair of the Commonfund Board of Trustees. The roundtable...
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Responsible Investing | Articles
Environmental, social and governance (ESG) factors are a topic for active discussion in board rooms. Here’s an update on Commonfund’s thoughts and actions and how ESG may relate to you. In general,...
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Private Capital | Articles
For a variety of reasons, some investors believe that private equity may have lost its edge as a key allocation for their portfolios. This perception may overlook reality. A closer examination...
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Outsourced CIO | Articles
Why an OCIO that's dedicated to serving nonprofits may be preferable to a general practitioner As the OCIO model has evolved and expanded in recent years, a number of financial providers have entered...
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Risk Management | Articles
Risk management: the process of harnessing risk in pursuit of better investment returns In a broad sense, how should nonprofit institutional investors think about investment risk and risk management?...
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Private Capital | Insights Blog
For reasons unknown, many investors assume that private equity may have lost its edge as a key allocation for their portfolios. This perception, however, may not align with reality. By taking a...
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Investment Strategy | Articles
How have cultural, religious and social service institutions’ investment portfolios changed in response to the financial and market environment that has prevailed over the last several years? While...
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Governance And Policy | Insights Blog
The regulatory and legislative landscape continues to become more rigorous for nonprofit organizations. In an atmosphere of increasing calls for accountability, boards and senior staff need to take...
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Private Capital | Insights Blog
In the wake of the Global Financial Crisis, institutional investors were rightfully concerned about the liquidity profiles of their long term portfolios. Although markets have recovered substantially...
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Governance And Policy | Articles
Follow this checklist and you'll be on your way… For nonprofit organizations of all kinds, the regulatory and legislative landscape continues to become more rigorous—which should not come as a...
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Investment Strategy | Articles
Today, few OCIOs that serve nonprofits are total institutional partners. Six questions can help you find one who takes a holistic approach. Not long ago, the definition and scope of an “Outsourced...
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Private Capital | Articles
Although it has been five years since the collapse of Lehman Brothers—an event that transformed a bad recession into a global financial crisis—the scars of that traumatic episode remain etched in the...
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Responsible Investing | Articles
Investing according to environmental, social and governance principles is maturing into a distinct discipline. Robust research results dispute the conventional wisdom about performance trade-offs. If...
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Governance And Policy | Articles
Facing cost pressures and a new regulatory regime, healthcare organizations — especially those in the small and mid-sized range — should consider adopting the principles of the endowment model....
Chart of the Month | Low Rates Make Record Government Debt Manageable – For Now