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Yale's $40.7 billion endowment (as of June 30, 2023) Source: Yale.edu
May 27
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Is this the calm before the storm?

By Uncategorized

CBOE Volatility Index

In the absence of any significant news, and with the Ukrainian situation easing somewhat, market volatility, as measured by the VIX has fallen to a 14 month low. Today VIX is trading just 0.65 above the March 14, 2013 low of 11.05, which was the low reached in this bull market. Many believe that a low VIX, which is sometimes called the “fear index,” indicates investor complacency, suggesting that the market is near its peak. Indeed the VIX hit a low of 9.36 in December 2006, 10 months before the peak of the stock market and the beginning of the greatest bear market in 75 years.

But the ability of the VIX to predict bear markets is spotty at best. The lowest level the VIX has ever reached since it was first computed in the mid 1980s, was 8.89 in December 1993. Although the onset of 1994 was rough because of the unexpected rate increase put in by Fed Chief Alan Greenspan, the secular bull market was still well intact. Another intermediate low for the VIX of 10.00 was reached on March 1995,
but that also did not mark a market peak. In fact the VIX continued to rise in the last five years of the great 1982-2000 bull market which peaked on March 2000.

The Chicago Board Options Exchange Volatility Index, or VIX, is widely considered to be stocks’ “fear gauge.” When things get wild, usually the VIX will increase in value. A portion of the investment community points to this as us being “lulled to sleep by complacency,” and the law of averages will bring us back to more volatile times. However, they may also have simply grown too accustomed to what could turn out to be a brief period in history when volatility was abnormally high. Whatever the case, the S&P 500 has traded in a tight range of only 4.5 percent since March 4, according to the Wall Street Journal. This calmness among stocks has been eerie to some, and surprising to almost everyone.

Is this the calm before the storm? Is Sell-In-May-And-Go-Away going to cause the VIX to go higher?

(Source: WSJ, etc.)

May 27
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EWM Number of the Day: 5/27/2014
May 23
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20 largest university endowments as of June-2013

By Endowment Index™
Rank School Endowment Change from 2012
1 Harvard University $32,334,293,000 6.2%
2 Yale University $20,780,000,000 7.4%
3 University of Texas System $20,448,313,000 12.0%
4 Stanford University $18,688,868,000 9.7%
5 Princeton University $18,200,433,000 7.4%
6 Massachusetts Institute of Technology $11,005,932,000 6.8%
7 Texas A&M University System and Foundations $8,732,010,000 14.3%
8 University of Michigan $8,382,311,000 9.0%
9 Columbia University $8,197,880,000 7.1%
10 Northwestern University $7,883,323,000 10.7%
11 University of Pennsylvania $7,741,396,000 14.6%
12 University of Notre Dame $6,856,301,000 8.3%
13 University of Chicago $6,668,974,000 1.5%
14 University of California $6,377,379,000 7.0%
15 Duke University $6,040,973,000 8.7%
16 Emory University $5,816,046,000 6.5%
17 Washington University in St. Louis $5,651,860,000 8.1%
18 Cornell University $5,272,228,000 6.6%
19 University of Virginia $5,166,660,000 7.9%
20 Rice University $4,836,728,000 9.5%
Note: The change in endowment value reflects investment returns, additions from donor gifts and other contributions, fee payments and university withdrawals during the fiscal year ended June 30, 2013.
Source: 2013 NACUBO-Commonfund Study of Endowments

First Published: January 28, 2014: 3:06 PM ET
May 23
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EWM Number of the Day: 5/23/2014
May 22
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New Endowment Index Launched to Provide Independent Benchmark for Fiduciaries

By News

Endowment Index™ now available as a benchmarking tool for investors that manage multi-asset portfolios comprised of both traditional (stocks and bonds) and alternative (private equity, real assets, hedge funds) asset classes.

Appleton, WI (PRWEB) May 22, 2014

Endowment Wealth Management, Inc. in collaboration with ETF Model Solutions, LLC have launched the Endowment Index™ (Symbol: ENDOW) as a benchmarking tool for investors in globally-diversified, multi-asset portfolios that include alternative investments. The Endowment Index, calculated by Nasdaq OMX® is an objective benchmark comprised of three major asset class building blocks: Global Equity, Global Fixed Income, and Alternatives which includes hedge funds, private equity and real assets. The Index is used for portfolio comparison, investment analysis, research and benchmarking purposes by fiduciaries such as trustees, portfolio managers, consultants and advisors to endowments, foundations, trusts, defined benefit/defined contribution plans, pension plans and individual investors. The Endowment Index™ is a total return index and all underlying components are comprised of exchange-traded funds or other investable securities.

“The proliferation of exchange-traded products and mutual funds that offer alternative strategies in liquid form is leading to the increasing adoption by investors outside of the institutional endowment universe,” said Prateek Mehrotra, Chief Investment Officer of Endowment Wealth Management. “Until now, they’ve had to use a proxy or a custom benchmark for those portfolios. The Endowment Index™ now provides an appropriate benchmarking solution for investors that embrace the Endowment Investment Philosophy™.”

The use of alternatives has broadened beyond endowments. Recent studies by Barclays Prime Brokers estimates that use of liquid alternatives grew 43% to $137 billion in 2013, and that by 2018, assets in this space could stretch to between $650 and $950 billion. Index data can be accessed through most major quote providers and websites under the symbol “ENDOW”. For more information visit http://www.EndowmentIndex.com

Endowment Wealth Management, Inc. is an independent Private Wealth Management Firm using a Multi-Client Family Office service model, whose sole mission is to provide wealth sustainability for individuals, families, retirement plans, endowments, foundations and other institutions through the utilization of the Endowment Investment Philosophy™.

ETF Model Solutions, LLC, is third party investment manager and ETF strategist that builds investment models for 401(k) plans, Investment Advisors within their practice, Family Offices, Endowments, Foundations, Trusts, and Individual Investors. The Firm is the fund manager for the Endowment Multi-Asset ETF Collective Investment Fund, available for use in 401(k) and other retirement plans.

Information presented is for educational purposes only and is not intended as an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies, nor shall it be construed to be the provision of investment advice. Investments involve risk and unless otherwise stated, are not insured or guaranteed. Be sure to consult with a qualified financial advisor and/or tax professional before implementing any investment strategies discussed herein. While the firms are related and share corporate offices, Endowment Wealth Management, Inc. and ETF Model Solutions, LLC are each individually registered as an investment adviser in the State of Wisconsin. You cannot invest directly in an index. Indexes do not contain fees. A copy of each firm’s respective disclosure document, Form ADV Brochure Part 2, is available upon request.

May 21
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EWM Number of the Day: 5/21/2014
May 20
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EWM Number of the Day: 5/20/2014
May 19
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EWM Number of the Day: 5/19/2014
May 16
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EWM Number of the Day: 5/16/2014