Q307 Saw Modest Institutional Returns

October 23, 2007 (PLANSPONSOR.com) - Most U.S. institutional investment plan sponsors reported modest returns for the third quarter of 2007, according to data in the Northern Trust Universe.

A Northern Trust news release said foundation and endowment and public fund plans gained 2.3% at the median, while corporate plans returned 2.2% for the quarter.

Emerging markets dominated the quarter, with the Northern Trust Emerging Markets universe returning 11.8% at median for the quarter and 33.6% at median for the year.

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Fixed income and private equity returns also added value during the quarter, with quarterly median program returns of 3% and 5.3%, respectively, according to Northern Trust.

Over longer time periods, plan sponsors were able to maintain solid returns, despite the increased volatility. The median foundation & endowment plan returned 13.7% over three years while the median corporate and public fund plans returned 13.4% and 13.5%, respectively, over the same period, according to Northern Trust.


“U.S. institutional plans rebounded from a poor start to post modest returns in the third quarter,” said Joe Nardulli, product manager, Northern Trust Investment Risk & Analytical Services, in the news release. “Strong equity performance during September helped pull returns for most plans into positive territory. Other asset classes also contributed to performance in the Northern Trust Universe, helping plans finish slightly ahead of the gains made by the broad market equity indexes.”

The Northern Trust Universe represents the performance results of more than 300 large institutional investment plans, with a combined asset value of approximately $700 billion, which subscribe to Northern Trust performance measurement services.

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