The content contained herein is purely for informational purposes and is neither an offer to sell nor a solicitation of an offer to purchase any securities. Such an offer will only be made to pre-qualified investors by means of a confidential private placement memorandum and related subscription documents.

First Quarter 2015: Investment Perspective

Financial assets performed well in the first quarter. Global equities and bonds both rose modestly. The European Central Bank started its asset purchase program in the quarter, and European sovereigns have traded to never-before-seen lows in yield. That desperation for yield is seeping over into markets for U.S. rates and foreign exchange. Recent data points suggest that global growth is becoming more balanced, with the United States decelerating slightly and the euro zone showing signs of vigor.

Markets have reflected the change, as non-U.S. markets outperformed the United States. That said, markets continue to be punctuated by significant geo-political and macro/monetary events. The crisis in Ukraine, Greece’s fiscal impasse, and proxy conflicts in Syria/Yemen/Iraq remain unresolved. Each of these risk upsetting the existing order with unpredictable consequences for global policy and economies. As a result, short-term financial asset prices are reacting forcefully to instantaneous developments. Algorithmic trading appears to be exacerbating these swings, heightening volatility. But, as history has demonstrated, these types of events have little impact on the longer term value of financial assets. That is driven primarily by valuation, which is where we focus our efforts in allocating client assets.

On a quarterly basis, Hirtle Callaghan publishes our perspective on the current market.  We have included the first page of that piece below.  If you would like to receive the full perspective, please contact us.

Download the first page

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Fourth Quarter 2014: Chart of the Quarter

Today's most appealing valuation opportunities appear largely in companies domiciled outside of the United States.  International Developed, Emerging Market, and Commodity-related equities all sport high relative risk premiums and represented the largest overweights in client portfolios at the start of 2015.  A diversified basket of these equities offers more than 250 basis points of excess expected return above the broad U.S. market over a seven-year horizon.  Inside the United States, small cap stocks, and in particular, small cap value stocks, remain an overvalued part of the market from our perspective. 

On a quarterly basis, Hirtle Callaghan publishes our perspective on the current market.  We have included the first page of that piece below.  If you would like to receive the full perspective, please contact us.

Download the first page

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Never Again: Start Now to Protect Gains in Your Pension Plan’s Funding

Pension plan funded status has come a long way since the ravages of the financial crisis and today stands near a seven year peak. For plans that have not started down the de-risking path, now may be the time to begin locking in gains. Heading into 2008, most pension plans were healthy and overfunded. By the end of that climactic year, the average plan had been devastated by a “perfect storm” of increasing pension liabilities (from falling interest rates) and falling asset values. Having been burned in 2008, wise pension sponsors are taking a “never again” approach to protecting their plan’s funding.

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Fourth Quarter 2013: Chart of the Quarter

Financial markets have rallied dramatically from the lows of the Global Financial Crisis in 2008. Risk assets have realized double-digit five-year compound annualized returns despite a succession of challenges. An economic crisis in Europe, lackluster employment growth, political gridlock, elevated energy prices, and geopolitical turmoil have created constant uncertainty for investors. At each impasse, global markets have yielded some ground initially but then swiftly recovered losses.  The markets’ collective ability to withstand external shocks has been due in large part to the role of the U.S. Federal Reserve.  The Fed and other central banks have provided a progressive stimulus to economies and eased financial markets’ anxiety.

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Tax and Estate Planning

The Patient Protection and Affordable Care Act (“ObamaCare”) and the American Taxpayer Relief Act of 2012 (“ATRA”) will cause many taxpayers to experience a higher tax bill for 2013 and for the foreseeable future.Most of us begin each year with a list of New Year’s resolutions that we would like to accomplish during the upcoming year. If your list includes minimizing your tax bill or improving your family wealth planning, there are a number of planning opportunities that you may want to consider in early 2014.  Please click here to see some of Alan Weissberger’s thoughts. 

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