Services Tags: Asset Allocation

Luis Sierra Speaking at College Savings Plan Network 2024 Virtual Prepaid Tuition Plan Mini Conference 4/10

On Wednesday, April 10, Luis Sierra, CFA will be speaking at the 2024 College Savings Plan Network Prepaid Tuition Plan Mini Conference, being held virtually.

Luis will be joining a panel entitled, “Well-Funded Plans: Where Do We Go From Here?” with several investment professionals, described as follows: Most Prepaid Plans are in the enviable position today of being overfunded in comparison to our future participant obligations. This session will look at how we arrived in this position by reviewing the forces that led us to this overfunding. Should something in our fundamentals change (e.g. unit price, underlying actuarial assumptions, asset allocation of our investments)? Then, we have to ask what do we do with the surpluses? And finally, do we change Plan elements going forward?

The College Savings Plans Network (CSPN), an affiliate of the National Association of State Treasurers (NAST), is a national non-profit association and the leading objective source of information about Section 529 College Savings Plans and Prepaid Tuition Plans — popular, convenient, and tax-advantaged ways to save for college. This MiniCon will discuss topical issues impacting prepaid plans and how states are continuing to adapt to keep their plans relevant in a changing world. For more information, please visit the event webpage.

Marquette Approach to Manager ESG Due Diligence Featured on FundFire

Published March 11, Linsey Schoemehl Payne, Chief Compliance Officer and Partner, was interviewed for “Consultants Evolve Approach to Assessing Managers on ESG,” by FundFire (subscription required).

Linsey discussed Marquette’s approach to manager due diligence regarding ESG integration in the investment process, explaining the “second tier” of information Marquette’s questionnaire seeks out covering the team overseeing individual strategies and the firm’s record of engagement through proxy voting and shareholder resolution.

This article follows a feature published by Nonprofit News last quarter and reflects Marquette’s 25-plus-year commitment to providing clients with clear and thorough information when considering sustainable investment options.

Out of Office: Where Real Estate Markets Stand Today

Commercial real estate is increasingly being dubbed the next shoe to drop as markets assess the fallout from the regional banking turmoil. Amid higher rates and tighter credit conditions, private real estate is now facing the same repricing dynamics that hit the equity and bond markets last year, and while further write downs are expected, the headlines are likely overblown. Fundamental and financing issues are largely concentrated within the office sector — which will likely see a correction over a longer time period but be manageable for most core real estate funds — while other sectors, including industrial and multifamily, are actually set to benefit over the next few years.

This newsletter analyzes the current commercial real estate investment landscape including valuations, fundamentals, debt markets, and private real estate returns.

Read > Out of Office: Where Real Estate Markets Stand Today

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

Private Equity Views Featured in Evercore State of the Market 2024 Report

An article by Amy Miller, Senior Research Analyst at Marquette, was featured in Evercore Private Fund Group’s annual State of the Market publication. The article, The Four Virtues of Private Equity, presents a framework of considerations for private equity investors to effectively navigate the market in 2024.

Amy’s paper proposes four virtues — prudence in discerning appropriate allocations and timing, temperance in exercising consistency in pacing, fortitude in remaining invested through periods of stress, and justice in aligning manager and investor interests — that reaffirm that private equity portfolios should prove resilient over the long term.

Download PDF > Evercore State of the Market 2024: The Four Virtues of Private Equity

Evercore is a premier global independent investment banking advisory firm. The full State of the Market report includes a series of interviews, think pieces, and insights from a number of high-quality contributors. To receive a copy of the publication, please contact their team. Reproduced with permission from Evercore Private Funds Group, excerpted from  Evercore’s State of the Market 2024 report. © Evercore. All rights reserved. 

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

Ryan P. Tracy Speaking at Mountain States Institutional Forum 3/21

On Thursday, March 21, Ryan P. Tracy, CFP® will be speaking at the 11th Annual Mountain States Institutional Forum in Denver, Colorado.

Ryan will be moderating the opening panel discussion, “Macro-Outlook & Asset Allocation: The Next 12 Months at a Glance,” described as follows: Top thinkers and chief investment officers share their investment views about current U.S. asset allocation strategies and their projected macroeconomic outlook for the next 12 months. This panel will aim to answer the following questions including but not limited to:

  • How do our panelists account for these and other factors that could affect their global investment and business decisions related to operating an institutional organization?
  • With inflation rates approaching record highs, how will the markets react, and what sort of fiscal policy will be on the horizon?
  • Is there a place for thematic investing and how are behavioral and social finance considered?

For more information, please visit the event webpage.

Here to Stay? Fixed Income Opportunities Persist Despite First Quarter Volatility

Going into 2023, one of the primary headlines was the return of “income” to the fixed income asset class. Largely as a result of Fed policy in 2022, yields increased significantly over the course of the year, thus finally offering meaningful income to bond investors. At long last, fixed income could provide all three of its staples to portfolios: diversification, liquidity, AND income. With the Federal Reserve committed to further hikes during the first half of the year, expectations were that the opportunity set would last well into the year.

However, bank failures and the associated fear of contagion have been known to not only fuel volatility in equity and credit markets but send investors to the safety of Treasuries. This dynamic naturally drives prices higher and yields lower as investors look to insulate their portfolios from large drawdowns. That said, the Silicon Valley Bank shutdown coupled with other nervousness around regional banks and then the eventual absorption of Credit Suisse by UBS has not had a significant impact on the outlook for fixed income as of quarter end. After trading inside of 2% since 2020, the yield on the Bloomberg aggregate index closed the first quarter at 4.40%, slightly lower than the December 31, 2022 figure of 4.68% but well ahead of its near-zero value in the years leading up to 2022.

This newsletter analyzes recent market dynamics and the current environment and outlook for fixed income.

Read > Here to Stay? Fixed Income Opportunities Persist Despite First Quarter Volatility

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

Greg Leonberger Featured on Dakota Live! Podcast

Recorded earlier this year, Director of Research and Partner Greg Leonberger, FSA, EA, MAAA, FCA‘s Dakota Live! Allocator Interview is now available for viewing.

Greg spoke with Chris O’Grady, CIO and Partner at dakota, and Tim Dolan, Vice President, Institutional Sales, in the interview, titled “Building Client Trust.” Dakota Live! general calls allow listeners to access in-depth information about investment allocators through a live interview reviewing each allocator’s current needs, the details of their platform, key analysts, and their outlook on the industry.

Greg Leonberger is the Director of Research for Marquette Associates. Greg is responsible for creating the firm’s capital markets research and directing investment strategy and policies. He also serves as the chair of the investment committee. A partner of the employee-owned firm, Greg has been with the company since 2008. Greg joins us at Dakota Live! to take us through Marquette Associates’ manager research process and what they look for in asset management partners. Join us to learn how the firm’s approach to client service has made Marquette Associates so successful over the years.

For more information, please visit the Dakota Live! website.

 

This does not constitute an offer to sell, or a solicitation of an offer to buy, any interest in any investment vehicle, and should not be relied on as such. Marquette is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Marquette including our investment strategies, fees and objectives can be found in our ADV Part 2/Form CRS, which are available upon request and on our website. Forward-looking statements cannot be guaranteed. Past performance is not indicative of future results. Investing comes with risk. The content herein is not an endorsement nor a testimonial for Marquette.

Nat Kellogg Speaking at eVestment Institutional Trends Quarterly Webcast 12/5

On Tuesday, December 5, Nat Kellogg, CFA will be joining Nasdaq eVestment’s quarterly Institutional Trends Webcast.

Nat will be providing consultant commentary alongside Nasdaq eVestment’s Russ Elliott, Head of Asset Management, Market Intelligence, and Michele Shauf, Head of Client Experience Strategy, Investment Intelligence. The webcast briefs traditional managers on the state of the global institutional market using eVestment data, covering:

  • Where assets are moving and the key flow drivers by universe and geography
  • Where abrupt changes in flows direction may indicate inflection points
  • Where investors in North America, Europe and APAC are concentrating their research activity, in advance of allocation decisions
  • The state of ESG: AUM, flows and allocator interests
  • New facets of ESG data, including universes ranked by carbon emissions

For more information and to watch the replay, visit the event webpage.

The 60/40 Portfolio Revisited: Back from the Dead?

In response to an inquiry concerning rumors of his demise in 1897, American writer and satirist Mark Twain quipped, “The report of my death was an exaggeration.” This quote may also apply in the case of the 60/40 portfolio and a white paper published by Marquette Associates in late 2021. The piece, entitled, “Is the 60/40 Portfolio Dead Forever?” examined the challenges faced by the popular model consisting of a 60% allocation to diversified equities and a 40% allocation to a broad basket of fixed income securities. These challenges included elevated equity valuations and the prospects of rising interest rates and slowing economic growth. Indeed, both stocks and bonds struggled mightily last year due to these and other headwinds, with 2022 one of the worst on record for the 60/40 portfolio. That said, and amid a strong start to 2023, there are reasons for optimism when it comes to the viability of the model to again generate attractive risk-adjusted performance.

This white paper provides historical context for the 60/40 portfolio, details its current outlook, and outlines ways in which investors can augment the model to achieve desired return targets.

Read > The 60/40 Portfolio Revisited: Back from the Dead?

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

2023 Market Preview: Trail Guide to 2023 Asset Class Performance

As winter takes hold in the northern hemisphere, there are those that choose to escape to warmer climates and those that embrace the season and choose the mountains. Anyone familiar with downhill skiing knows that every ski trail is marked with a shape and color to designate its difficulty. For those unfamiliar with these ratings, the North American system looks like this:


Of course, weather and trail conditions can also impact a trail’s difficulty and must be accounted for when turning down the mountain: environment and terrain matter. Similarly, investment prognostications must recognize the current setting. By now, the environment is all too well known: high inflation, aggressive Fed policy, Russia–Ukraine war, labor supply shortages, and a potential recession. These topics have been covered extensively in recent letters and continue to loom over markets as we start 2023. At a high level, general consensus is that the majority of rate hikes from the Fed are behind us (two are expected for 2023 at time of writing), and inflation will continue to normalize in 2023, thus further supporting the thesis of fewer rates hikes from the Fed over the next year. If a recession comes to fruition, expectations are for it to be short-lived and shallow which reduces the long-term threat to markets.

With this backdrop in mind, we turn our attention to an asset class by asset class outlook for the coming year, assessing the degree of difficulty for each to deliver positive returns in 2023. In some cases, the difficulty will change as the year goes on — similar to trails that are “Most Difficult” for the first half and become more palatable as the journey goes on…which brings to mind a certain trail in Utah that the author found himself on last year that literally had him over his skis…but I digress. Tighten your boots and click into those skis!

Read > Trail Guide to 2023 Asset Class Performance

Download > 2023 Market Preview Report with 100+ additional charts and data, organized by asset class

Watch >  2023 Market Preview Video recording of our research team’s live webinar analyzing last year’s performance as well as trends, themes, opportunities, and risks to watch for in 2023

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. Marquette is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Marquette including our investment strategies, fees, and objectives can be found in our ADV Part 2, which is available upon request.