Reinventing the Endowment Model – taking a dynamic approach to an established classic
For over 25 years, endowments and foundations have been applying the principles of the endowment model to secure the futures of some of the world’s most prestigious institutions. Thanks to their advocacy of healthy diversification across traditional and alternative assets, many endowments have outperformed over the long-term, but pressure to switch to cheaper, simpler alternatives…
Read MoreAdvancing the Endowment Model
The endowment model of investing, which advocates healthy diversification across traditional and alternative assets, has come under fire. At a time when simpler and lower cost public equity and bond portfolios have been delivering strong returns, some critics are questioning whether multi-asset class diversification generates value given its complexity and higher fees. Yet in a…
Read MoreFive Key Strategies for Navigating UK Tax in Investment Portfolios
The UK General Election will be a catalyst for change right across the political and financial landscape. Post 4 July, the next government will likely need to make spending cuts or tax increases in order to meet its manifesto and political targets. While the full wave of the impact will take a few months to…
Read MoreSetting a Portfolio’s Long-term Illiquidity Budget
The top performing endowments and foundations generally exploit their long-time horizon with sizeable allocations to Private Equity, Real Estate and Private Debt, enabling them to harvest the illiquidity premium and greater alpha potential that we believe is inherent in these more inefficient private markets. Given the higher expected risk-adjusted returns and the long time horizon…
Read MorePortfolio Deployment: Immediate Deployment or Dollar-Cost Averaging
Investors with substantial uninvested capital face two key decisions: determining the optimal investment strategy for their needs, and deciding when this should be implemented. This article analyses the immediate deployment (or lump-sum investing) and dollar-cost averaging approaches in liquid equity markets and investigates whether it’s possible to improve the outcomes associated with dollar-cost averaging by…
Read MoreApples and Oranges: The Power of Equity-Like Risk Measurement
There is a common saying when comparing unlike things – that comparing them is like “apples and oranges”. Nevertheless, those fruits are usually sold the same way, by weight or by count. Similarly, in this post, we explore how to compare securities across asset classes through the lens of equity-like risk. Risk is complex. Threats…
Read MoreThe Future of Private Equity Investing is all about Post-Acquisition Operational Value Add (PAOVA)
Over the past decade, almost any private equity (PE) firm has been able to generate outsized returns. Falling interest rates have boosted returns in most asset classes, including buyouts that benefit from high leverage and low borrowing costs, as well as venture capital and growth equity that benefit from low discount rates, inflating back-ended cash…
Read MoreAsia as a source of diversification for global investors
Diversification was hard to come by for global investors last year. Rising U.S. interest rates sank almost all boats in a coordinated sell-off across capital markets: U.S. equities were down 18.1%, U.S. investment-grade bonds were down 15.6%, nominal Treasuries were down 12.5% and inflation-linked Treasuries were down 11.8%. European assets followed a similar path, with…
Read MoreWhat is an Outsourced Chief Investment Office (OCIO)?
What is an Outsourced Chief Investment Office (OCIO)? A full-service OCIO should offer comprehensive investment program management including an agreed overall investment policy, strategic and tactical asset allocation, portfolio construction, asset manager selection, risk monitoring and management, performance reporting and attribution, and middle and back-office operations. OCIOs are fiduciaries and, as such, must provide assurance to…
Read MorePartners Capital and the Clean Air Task Force Workshop: Bringing the Energy Transition Down to Earth
On the 14th of September 2022, Partners Capital combined with the Clean Air Task Force (CATF, an energy transition think tank) hosted a workshop lunch entitled “Bringing the Energy Transition Down to Earth” at the National Science Museum in London. The idea for the workshop emerged from our desire to gain an ever deeper set…
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