Investment Strategy
Virtually all of these endowment gifts have been pooled. The investment of these funds is under the direction of the Investment Committee of the Board of Trustees, as established in the University’s bylaws. This committee was chaired again this year by Sumner B. Tilton, Jr., a Life Trustee, former Board chair, and an attorney with the Worcester firm of Fletcher Tilton & Whipple. Other members were Allen M. Glick B.S.B.A. ’63, Robert J. Stevenish, David H. Strassler, Lawrence L. Landry, B.S.B.A. ’71, M.B.A. ’75, and Todd H. Wetzel. The committee works with the University’s Treasurer and Executive Vice President James E. Collins. The Investment Committee is guided in its work by a “Statement of Investment Objectives, Goals and Policy Guidelines,” which was last approved by the Board of Trustees on Feb. 4, 2005.
In this statement, the committee sets out a disciplined strategy designed to earn a long-term total investment return (both income and capital gains) sufficient to preserve and enhance (in real-dollar terms) both the gift principal of the funds and the annual income available to support the intended programs. This objective has been met, and with the strong financial markets of the past 25 years, significantly exceeded. With its strong aversion to market risk and its focus on valuation levels, the committee has positioned the portfo lio somewhat defensively over the past several years with a greater allocation to hedge funds, absolute return funds and value equities. In 2003, we added timber investments, and allocated 3 percent of the portfolio’s assets. In 2004 and 2005, new allocations were made to absolute return funds, private equity and timber investments, while exposure to fixed income and domestic equity was further reduced.
Total investment return for the year ended June 30, 2005 was 13.5 percent, which will compare very favorably with other balanced funds. Over the past ten years ending in June 2005, our average annual return of 10.4 percent compares with our benchmark of 8.9 percent and a 65 percent/35 percent equity/fixed index return of 6.8 percent. We do not yet have comparable data for other colleges and universities for the 2004-05 year. As of June 30, 2004, Clark’s one-, three-, five- and 10-year average annual returns were in the top 6 percent, 11 percent, 9 percent and 31 percent, respectively, of all educational endowments.
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Clark Endowed Funds
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Katrina Twing '07, recipient of the Gerard M. Pomerat Scholarship Fund, with her mother Lori |
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