<!-- Swiftype Variables -->

Asset Owners

Foundations, endowments lead Northern Trust plan universe returns

Institutional asset owners in the Northern Trust universe returned a median 0.9% in the second quarter, up from the median plan posting a loss of 0.4% in the previous quarter, said data released Tuesday.

Foundations and endowments posted the highest quarterly median return among plan types at 1.2%, followed by public defined benefit plans at 1.1% and corporate DB plans at 0.3%.

For the 12 months ended June 30, foundations and endowments also posted the highest median return at 8.7%, followed by public DB plans, 8.5%, and corporate DB plans, 6.3%.

Bill Frieske, senior investment performance consultant, investment risk and analytical services, said in a news release on the results that the results of corporate DB plans "were weighed down by their larger allocation to fixed income, particularly longer-duration bonds, which had a negative quarter."

For the three and five years ended June 30, public funds in Northern Trust's universe returned an annualized 7.1% and 8.4%, respectively; corporate plans, 6.8% and 7.9%; and foundations and endowments, 6.7% and 7.8%.

"Equity markets snapped back in the second quarter, driving overall performance for institutional plans," said Mark Bovier, North America regional head of investment risk and analytical services at Northern Trust, also in the release. "Stocks are a core holding for most plans, and publicly traded equity programs returned about 3.9% at the median in the second quarter, up from negative 0.3% in the prior quarter. Private equity, real estate and hedge funds also contributed to quarterly gains for plans in the universe."

The median private equity program gained 2.8% in the second quarter, while real estate and hedge funds were up a more modest 1.9% and 1%, respectively.

The Northern Trust universe consists of about 300 large U.S. institutional plans with combined assets of about $985 billion.