Endowment and foundation executives are pretty worried about the threat to their portfolios from a slowdown in global growth, but they are just about equally split about the positive impact the election of either U.S. presidential candidate will have on their portfolios.
About 52% of the 59 endowments and foundations surveyed in late July by NEPC LLC, Boston, said the sluggish global economy is the biggest danger looming over the returns of their investment pools. Rising interest rates were the worst omen for performance for 16% of those surveyed, while 13% of respondents each named conflict outside the U.S. and global deflation as their most terrifying specters. About 4% of respondents said they are most worried about emerging markets issues and 2% were wary of currency risk.
However, when it comes to picking which presidential candidate would have a more positive effect on U.S. markets and their portfolios, 51% of NEPC's respondents named Hillary Clinton and 49% named Donald J. Trump.
As to which candidate will prevail in the presidential election, an overwhelming 70% of those surveyed predicted a Clinton win.
Brexit apparently hasn't fazed managers of non-profit pools because 90% said they won't change their allocation to international equities in response to the U.K.'s vote to leave the European Union, and 6% said they will up their investment in non-U.S. stocks. Just 2% of those surveyed said they will lower their international equity portfolio weighting.