Services Tags: OCIO

Linsey Schoemehl Payne Speaking at LinkBridge Investors Midwest Annual Meeting 9/21

On Thursday, September 21, Linsey Schoemehl Payne will be speaking at the Midwest Investors Annual Meeting hosted by LinkBridge Investors in Chicago.

Linsey will be joining a panel session entitled, “Institutional Investors Roundtable Discussion,” with several investment professionals, addressing the following question: What type of investment structure are institutional investors looking for and where is the greatest potential for growth?

The Midwest Investors Annual Meeting gathers the world’s leading managers along with institutional and private wealth investors from Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin to learn from and alongside industry thought leaders. For more information, visit the LinkBridge Investors website.

1Q 2023 Market Insights Video

This video is a recording of a live webinar held April 20 by Marquette’s research team, featuring in-depth analysis of the first quarter of 2023 and themes we’ll be monitoring in the coming months.

Our Market Insights series examines the primary asset classes we cover for clients including the U.S. economy, fixed income, U.S. and non-U.S. equities, hedge funds, real estate, infrastructure, private equity, and private credit, with presentations by our research analysts and directors.

Sign up for research alerts to be invited to future webinars and notified when we publish new videos.
For more information, questions, or feedback, please send us an email.

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.

Nat Kellogg Speaking at ALTSCHI 2023 Forum 7/17

On Monday, July 17, Nat Kellogg, CFA will be speaking at ALTSCHI,  jointly hosted by the CFA Society Chicago, CAIA Association, and Markets Group July 16–18.

Nat will be moderating a panel entitled, “Increased Appetite for Secondaries Markets,” described as follows: Private equity investors are increasingly turning to the secondary market to find value opportunities while LPs work to boost liquidity. Exposures are being weighed and sold at heavy discounts in sectors such as hospitality, consumer-related, energy, and transportation. These low asset prices also present valuable opportunities for LPs to co-invest alongside managers at more favorable stages of the investment cycle. How can investors take advantage of secondaries to boost returns and what advantages do they provide over individual manager selection?

ALTSCHI brings together leadership from the region’s institutional investor, wealth management, and alternative asset manager community to share views on alternatives as we continue to navigate these volatile times. For more information, please visit the event webpage.

Update on Silicon Valley Bank and the Impact on Markets

Silicon Valley Bank (SVB), the 16th largest bank in the U.S. by assets as of year-end 2022, was shuttered by regulators last Friday, March 10. This is the country’s first material bank insolvency since the Global Financial Crisis (GFC) and the second-largest bank failure in U.S. history, behind only the government takeover of Washington Mutual in 2008. The bank’s collapse came as a surprise to markets — both S&P and Moody’s had an investment-grade rating (BBB) on the borrower and equity markets showed few signs of foreseen stress. Additionally, earlier last week, smaller Silvergate Bank announced it would voluntarily liquidate, and over the weekend, Signature Bank was seized by New York regulators, marking the U.S.’s third-largest bank failure.

Over the weekend, the Treasury, Federal Reserve, and FDIC came together to shore up confidence in the U.S. banking system. Via joint statement, the consortium announced that all depositors at SVB and Signature Bank would be made whole, easing concerns that deposits over the FDIC-insured limit of $250,000 would be at risk, and introduced a new $25 billion bank funding program, the Bank Term Funding Program, to make additional funds available to banks at more favorable terms, to hopefully prevent a repeat of the events that led to SVB’s demise. Both initiatives will come at no cost to the U.S. taxpayer. While the measures should help corporations, consumers, and markets breathe a sigh of relief — there was fear over the weekend that SVB clients would not be able to pay employees, which could lead to a downward economic spiral — concerns about possible systemic risk and broader implications for the economy remain.

This newsletter summarizes the impact of SVB’s failure on the markets, including potential for contagion, SVB exposure across asset classes, and expectations regarding Fed tightening from here.

Read > Update on Silicon Valley Bank and the Impact on Markets

 

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.

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.

Patrick McDowell Speaking at AIMSE 2023 Annual Conference 5/1

On Monday, May 1, Patrick McDowell, CPA, CAIA will be speaking at the 46th Annual Association of Investment Management and Sales Executives (AIMSE) Sales & Marketing Conference in Scottsdale, Arizona.

Patrick will be joining a panel entitled, “OCIO Services: How can you and your firm upskill your toolkit to grow your business?” described as follows: For more than a decade, institutional investors have elected to invest their assets via OCIO services. This trend in OCIO adoption is likely to continue; according to a 2022 Cerulli Associates survey, 25% of institutional investors are considering OCIO services in the next 24 months. Our panelists will include consultants and portfolio managers who recommend and manage OCIO programs. This panel will explore future opportunities in the sector and how to position your firm to successfully participate in the space.

The AIMSE is a not-for-profit professional organization that seeks to provide an educational forum for those employed in the investment management sales and marketing services profession worldwide.

For more information, please visit the AIMSE website.

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.

2023 Market Preview Video

This video is a recording of a live webinar held January 19 by Marquette’s research team, featuring in-depth analysis of the final months of 2022 and a look ahead at risks and opportunities to monitor in the year ahead. Our Market Insights series examines the primary asset classes we cover for clients including the U.S. economy, fixed income, U.S. and non-U.S. equities, hedge funds, real estate, infrastructure, private equity, and private credit, with presentations by our research analysts and directors.

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

Read > 2023 Market Preview: Trail Guide to 2023 Asset Class Performance

 

Sign up for research alerts to be invited to future webinars and notified when we publish new videos.
For more information, questions, or feedback, please send us an email.

Amy Miller Named to Kayo’s 23 in ’23 Midwest Women in Endowments & Foundations List

Published today, Senior Research Analyst Amy Miller was named to Kayo Conference Series’ Top 23 in’23: Midwest Women in Endowments & Foundations list. “This 23 in ’23 report shines a light on endowment and foundation leaders who find investment opportunities to create financial returns that go towards an important mission. By stewarding capital for their institutions, these women create opportunities for many people, including many other women, to pursue their dreams.” For more information, visit the Kayo announcement page.

Amy has over 23 years of investment experience and currently is responsible for conducting due diligence on private equity products and managers, as well as developing macroeconomic and capital markets research. Her previous industry experience includes serving as private markets investment manager at Drexel University’s Endowment, working at various investment management firms in portfolio management and investor relations, providing operations management consulting to private equity-backed businesses, and in the public sector serving as an investment officer for a large municipal pension plan.