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Perspectives | Articles
On average over the past decade, independent schools participating in the Commonfund Benchmarks Study® of Independent Schools have maintained an asset allocation that stays within a few percentage...
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Perspectives | Insights Blog
For fiscal year 2020, independent schools reported an average return (net of fees) on their endowment assets of 2.8 percent. In this infographic, we report the key highlights from the 2020 Commonfund...
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Perspectives | Insights Blog
Black History Month is an annual celebration of achievements by African Americans and a time for recognizing their central role in U.S. history. Also known as African American History Month, the...
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Perspectives | Insights Blog
To more accurately plan for future expenses and budgeting needs most colleges and universities look to the Higher Education Price Index (HEPI). The HEPI is an inflation measure for current business...
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Perspectives | Insights Blog
Institutional investors continue to increase allocations to private strategies. Commonfund Capital’s fourth annual private markets investor sentiment survey shows trends continue despite the pandemic...
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Perspectives | Insights Blog
There are fundamental principles of effective endowment management that we have organized into what we call “the 6 Ps of Investment Stewardship”– Purpose, Policy, Process, Portfolio, People and...
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Perspectives | Insights Blog
In the midst of a global pandemic, many non-profit business models are being challenged which has put significant pressures on staff, governing boards and committees. These pressures on time and...
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Perspectives | Insights Blog
This year has been incredibly difficult. One of the most contentious and turbulent presidential elections and transitions in American History. COVID-19 and the consequential social and economic...
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Perspectives | Articles
Commonfund continues to be committed to diversity, equity, and inclusion efforts throughout the organization. The Commonfund Diversity, Equity, and Inclusion (DEI) Office has created a Diversity,...
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Perspectives | Insights Blog
For the year ended December 31, 2019, participating private foundations reported an average return of 17.4 percent while participating community foundations reported an average return of 18.2 percent...
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Perspectives | Insights Blog
Private capital investors use a particular set of quantitative and qualitative measures to assess performance. While the standard benchmarks used for marketable securities are sometimes applied to...
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Perspectives | Insights Blog
A tightly run RFP process can help ensure your organization will find an ideal investment partner to help you fulfill your organization’s mission. As the second installment of our blog series on the...
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Perspectives | Articles
Founded in 1909 in response to the ongoing violence against Black people around the country, the NAACP (National Association for the Advancement of Colored People) is the largest and most pre-eminent...
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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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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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Perspectives | 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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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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Perspectives | 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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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. In a three-part...
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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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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Perspectives | 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 | Inflation Expectations Surge, Driving Real Interest Rates Down