This issue marks the 20th anniversary of Pensions & Investments' Performance Evaluation Report.
On Feb. 28, 1977, the first formal report was published, covering a universe of 150 bank and insurance company pooled equity and fixed-income accounts. The accounts represented more than $15 billion in assets.
P&I's first efforts at performance evaluation actually appeared in 1974, when now-Editor Mike Clowes picked up his phone, called executives at 21 banks, and asked how their commingled funds had fared in the fourth-quarter market plunge of 1973.
The names of the firms listed in the pages of PIPER have changed since then, reflecting the mergers, acquisitions and spinoffs that have surged through the financial services industry in the past decades. In that first issue, for example, readers found the likes of Republic Bank, Dallas, now part of NationsBank; Crocker National Bank, San Francisco, now part of Wells Fargo; and several "First of . . ." banks that are now part of the First Interstate system.
The information contained in the report also has evolved, as the industry matured from primarily bank and insurance-company commingled core accounts. Now both commingled and separate account equity managers classify stocks into growth or value, and small-, large- and midcap styles. Fixed-income accounts are sorted by high yield, limited-duration, intermediate-duration, long-term and broad market portfolios.
But the basic function of the report remains: to allow those responsible for oversight of investment management firms to quickly see how firms they have selected, or might be considering, have performed over periods as long as 10 years.
In the listings published in 1977, readers found the asset size of each fund; the percentage held in equities or long-term bonds; and the rates of return for the 1-, 3- and 5-year periods ended Dec. 31, 1976. The full PIPER report included the above data plus background data on structures, characteristics and investment policies of the funds tracked; which market trends influenced these investments; and how the data compared with the historic return data of eight indexes.
By 1980, the full report covered about 400 portfolios from 200 banks and insurers, accounting for almost $27 billion.
Ten years later, the PIPER universe had expanded to 800 commingled portfolios, exceeding $253 billion, and the "PIPER +" universe accounted for 1,195 separately managed accounts worth more than $492 billion.
The full report covered the general equity and fixed-income categories, as well as real estate funds, special equity funds, international and global portfolios, and mutual funds offered by banks and insurers.
Today, the PIPER universe comprises more than 3,000 portfolios. The full report offers comparisons to 86 different indexes and analysis that covers beta, alpha and standard deviations.