Administration February 4, 2013

Northern Trust Universe Gained 12% in 2012

February 4, 2013 (PLANSPONSOR.com) - Institutional plan sponsors reaped a fourth consecutive year of positive investment returns in 2012.
Reported by

The median plan in the Northern Trust Universe posted a 12.3% gain. Corporate Pension Plans and Public Funds, with higher allocations to public equities, had stronger returns than the Foundations & Endowments segment in the 12 months ending December 31, 2012.   

Public equities were again key to performance in 2012, with programs in the Northern Trust Universe returning 16.9% at the median for the year. International equity programs gained 18.2% at the median, while the median U.S. equity program gained 16%. The median private equity program had a 10% return for the year, and total fixed income programs gained 8.8% at the median.

Corporate Pension Plans had the highest returns in the Northern Trust Universe, gaining 13.6% at the median in 2012. Public Funds–pension plans for public employees–gained 12.9%, and the Foundations & Endowments segment–funds managed for philanthropic organizations, colleges and universities–rose 11.5% for the year. In the fourth quarter, Public Funds led with 2.1%, Corporate plans gained 1.86% and F&E plans returned 1.81% at the median, according to Northern Trust Universe data.

“Corporate plans benefited from their higher allocations to public equities – 47 percent at the median – and just an 11 percent allocation to PE and hedge funds,” said William Frieske, senior performance consultant, Northern Trust Investment Risk & Analytical Services. “Conversely, F&E plans had 40 percent allocated to PE and hedge funds and 32 percent allocated to equities, at the median, and as a result lagged the pension segment by 200 basis points for the year.”
Administration February 4, 2013

Wilshire TUCS Sees Double Digit Gains for Most

February 4, 2013 (PLANSPONSOR.com) - With the exception of Taft-Hartley Health and Welfare Funds, institutional assets tracked by the Wilshire Trust Universe Comparison Service (TUCS), saw double digit returns during 2012.
Reported by

“In a quarter when the Wilshire 5000 Total Market Index(SM) was up 0.10 percent and the Barclays U.S. Aggregate was up 0.21 percent, it was impressive to see median returns for the fourth quarter ranging from a low of 0.39 percent for Taft Harley Health and Welfare Funds to 2.45 percent for Public Funds with assets greater than $5 billion,” stated Robert J. Waid, managing director, Wilshire Associates. “The median quarterly return for all plans was 1.70 percent,” he added.  

“’All Plans with assets greater than $5 billion’ was the top performing category with a median 2012 return of 13.45 percent. All plan types had a median return of 12.38 percent making this the fourth year in a row of positive median returns,” Waid said. “Three of those four were double digit gains. Nine out of the last ten years all plan types had positive returns; six of them double digits, for an annualized ten-year return similar to most actuarial plan targets of 7.55 percent. Leading the way, Foundations and Endowments with assets greater than $500 million had the best 10-year median return at 8.22 percent.”  

Get more!  Sign up for PLANSPONSOR newsletters.

Among Public Funds, large plans (plan assets greater than $1 billion) and mega plans (plan assets greater than $5 billion) out-performed small plans—not only for the quarter but also for the one- and ten-year periods. Larger plans also had larger median exposures to international equity and alternatives.

«