The UNT Foundation Investment Portfolio is structured to provide a consistent level of inflation-adjusted returns within acceptable long-term risk levels. It consists of an allocation of assets among well-diversified equity, fixed income, and alternative investments with a ratio of 53% Growth Assets, 37% Risk Reduction Assets, and 10% Inflation Protection Assets. Managers in each of these classes are benchmarked against the appropriate style median for each.
The Foundation utilizes a select group of money managers that have a consistent performance track record versus their benchmark, a sound investment process, and experienced investment consultation.
Northern Trust Russell 3000 Index's primary objective is to approximate the risk and return characteristics of the Russell 3000 Index. This Index is commonly used to represent the broad U.S. equity market. To achieve its objective, the Fund employs a replication technique which generally seeks to hold each Index constituent in its proportional Index weight. The Fund may make limited use of futures and/or options for the purpose of maintaining equity exposure.
Vanguard Total Stock Market Index (VITSX)is a passively managed mutual fund that seeks to match the performance of the MSCI US Broad Market index that measures the performance of the entire U.S. equity market. A sampling method is employed that involved purchasing the largest stocks in the index and a representative sampleof the rest. To ensure accurate tracking of the index, management attempts to duplicate certain index characteristics, such are industry weightings, market capitalization, and dividend yield.
Vanguard Dividend Appreciation Index Fund (VDAIX) tracks the performance of the Dividend Achievers Select index, a subset of the Broad Dividend Achievers Index, administered exclusively for Vanguard by Mergent. The index includes only those stocks with a history of at least 10 consecutive years of dividend increases and at least $500,000 in average daily trading volume. The index also filters the universe to eliminate certain segments such as REITs, thus adding a growth tilt in the process.
Jensen Large Quality Growth Fund (JENIX) is a concentrated, actively managed strategy that attempts to buy high quality stocks at a discount to their intrinsic values. Jensen Investment Management manages in excess of $2 Billion in one product, quality growth equity, with the bulk of the assets included in the Jensen Portolio mutual fund. Jensen constructs the portfolio from a universe of large-cap companies that have produced a long-term track record of persistently high returns on shareholder equity (at least 15% over each of the last 10 years). The fund is concentrated in 25 to 30 stocks. The quality purchase criteria typically keep them out of energy and other commodity or cyclical industries. Tobacco stocks are also excluded. Jensen believes that strong, enduring business performance combined with sustainable competitive advantages yields long-term growth and capital appreciation while minimizing investment risk.
Sands Capital Management manages a concentrated stock portfolio of large, well-established companies it believes have the potential for further growth. These companies are deemed to be good prospects by possessing (1) a leadership position in the market, (2) financial strength, and (3) recognition as good value companies compared to their industry peers. Founded in 1990, Sands Capital is managed by Frank Sands, Sr., CFA and William Johnson.
Vanguard Developed Markets Index (VIDMX) is a passively managed mutual fund in the international large-cap equity asset class that seeks to replicate the performance of the Morgan Stanley Capital International (MSCI) Europe, Australasia, and Far East (EAFE) index. The Fund utilizes a full replication approach by investing all, or substantially all, of its assets in the stocks that make up the Index, holding each stock in approximately the same proportion as its weighting in the Index.
Scout International (UMBWX) is an actively managed portfolio in the international large-cap stock asset class. Management employs a top-down approach, beginning with geographical selection, followed by sector/industry selection, and finally, stock selection. Geographical and sector/industry selection is based on macro-economic analysis. The Fund primarily invests in securities of seasoned companies known for quality and for their ability to generate profits.
Morgan Stanley International Equity (MSIQX) is an actively managed institutional mutual fund in the international large-cap asset class. Management employs a top-down, value-driven approach. Management seeks to identify firms that are trading at a discount relative to the future value of their forecasted free cash flows, or firms that are underpriced relative to the book value of their assets. In addition to the rigorous evaluation of fundamental company data, management requires the fund's investments to possess strong management teams with proven track records.
Vanguard Emerging Markets Stock Index (VERSX) is a passively managed, institutional class mutual fund that seeks to track the performance of the MSCI Emerging Markets index which represents the emerging markets in Europe, Asia, Africa, and Latin America. Vanguard employs a full replication, low tracking error approach to implement this fund. Vanguard's Quantitative Equity Group is responsible for management of this fund, as well as the firm's other indexed and structured equity portfolios.
Stone Harbor Local Currency Emerging Market Debt (SHLMX) is an actively managed mutual fund that invests in the local currency sovereign debt of emerging market countries. The investment process combines top-down forecasting with relative value analysis. Country and currency selection is based on a variety of qualitative and quantitative factors. Security selection is primarily driven by relative value based on spread analysis, curve positioning, liquidity, and scenario analysis. The Fund may use derivative instruments such as currency contracts, futures, options, and swaps, which are economically tied to emerging securities markets.
PIMCO Total Return Institutional Fund (PTTRX) employs a "core plus" fixed income style. The non-core or plus sectors include non-investment grade US bonds (high yield), non-dollar denominated foreign bonds, and emerging market debt. The fund's guidelines allow investments in high yield securities (rated B or better) up to 10% of total assets. The guideline limits exposure to the plus sectors to 30% of the portfolio. PIMCO normally hedges at least 75% of its exposure to foreign currency to reduce the risk of loss due to fluctuations in currency exchange rates. The fund is managed within a moderate duration range, typically one-and-one half years above or below that of the benchmark. As an efficient means of capturing exposure to a particular investment, they make substantial use of derivative instruments such as options, futures contracts or swap agreements, or in mortgage- or asset-backed securities.
J.P. Morgan Core Bond Fund (WOBDX) is an actively managed, intermediate-term, investment-grade bond fund. Management attempts to take advantage of inefficiencies in the fixed income market to maximize total return in a diversified portfolio of primarily intermediate and long-term, investment grade debt securities. The team uses a bottom-up, value-oriented approach to identify high quality securities that are inefficiently priced and rotate between sectors based on expected total return and valuation analysis.
Loomis Sayles Core Plus (NERYX)is a value oriented, actively managed mutual fund that provides exposure to the U.S. fixed income asset class. Tactical investments in non-benchmark sectors are a key source of potential return for this strategy. Guidelines provide flexibility to invest up to 20% of the portfolio in assets rated below BBB-. Limited investments are also authorized in non-dollar and emerging markets debt investments. Portfolio construction is driven by a combination of bottom-up security selection and top-down macroeconomic analysis.
Brandywine Asset Management, Global Bond Strategy is an active, tactical value-driven investment approach. Brandywine aims to outperform the Citigroup World Government Bond index by taking active positions in global bonds and currencies. The portfolio maintains an average credit rating of AAA with investments in a combination of sovereign debt, investment-grade corporate bonds, and mortgage backed securities.
PIMCO All Asset (PAAIX) is an actively managed fund of funds strategy which investments in a broad range of asset classes. The objective of the fund is to maximize the potential for long run real returns. To achieve this return goal, PIMCO engages a sub-advisor to allocate, on a tactical basis, in variety of underlying PIMCO funds. PIMCO does employ use of leverage in managing the portfolio.
Pinehurst Institutional Limited is a multi-strategy hedge fund of funds that targets a return of T-Bills plus 7% with annualized volatility of 6% over a full market cycle. Pinehurst is typically diversified across approximately 25 to 30 core funds. The primary strategy is long/short equity which historically represents approximately 35-55% of the allocation. The manager, Corbin Capital Partners, prefers fundamentally-oriented managers that are highly opportunistic, implementing strategies that are not reliant on excessive leverage. Portfolio level hedges may be held in an effort to reduce systematic risk.
Common Sense Investment Management, LLC Common Sense Offshore Limited seeks to preserve capital and provide superior risk-adjusted returns by generating positive absolute returns regardless of market direction. The Fund targets an annualized net return of 10% to 12% and endeavors to achieve this target with less volatility than the equity market over a market cycle. The firm has a conservative investment philosophy, taking a low-risk approach to investing (low use of leverage and low market exposure), where its primary objective is to avoid the loss of capital. The firm often invests with managers who are small and flexible and who are managing significantly less capital than their peers. Common Sense indicated that 75% of the underlying managers manage capital less than $500 million.
EII Global Property Fund (EIIGX) is a mutual fund which primarily invests in equity securities of property companies which own, operate, develop and manage real estate in US and global real estate markets. EII’s investment process employs a top down macro perspective together with bottom up fundamental research on securities and individual real estate companies. Top down research drives the market and sector selection. Company specific analysis plays a key role in investment selection in local markets where uniform and comprehensive information is not readily available.
Van Eck Global Hard Assets (GHAIX) is an actively managed mutual fund that invests in various hard asset sectors—base and precious metals, agriculture, paper and forest products and energy (including alternatives). The firm utilizes an index agnostic approach to managing the fund and thinks that its ability to diversify among different commodity sectors is a key source of its ability to add value. Van Eck believes that its fundamental, bottom-up stock selection process will enable them to identify undervalued companies with catalysts for growth.
BlackRock Diamond Property Fund, Inc. is an open ended private REIT that invests in a diversified portfolio of predominantly value-added real estate investments. Such investments will be made across the residential, office, retail, and industrial segments of the domestic real estate market.