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Alternative Investments

Qualified Opportunity Zone Funds

By Alternative Investments, Monthly Commentary, Tax Planning


What if you could do well by doing good—using your wealth to help revitalize economically distressed communities and enjoying some impressive tax breaks for your efforts? That’s exactly what you may be able to accomplish through a new type of investment called Qualified Opportunity Funds.

In this month’s Flash Report, Qualified Opportunity Funds: The Latest Way to Do Well by Doing Good, you’ll learn all about how Qualified Opportunity Funds work along with their many benefits. Armed with that information, you can start to determine if these funds make sense for you and your goals—and, if so, how to take the next steps.
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EWM Weekly Capital Market Highlights for Week Ended 03/23/2018

By Alternative Investments, Weekly Capital Market Updates No Comments


  • Global equity markets were led by Russia and Japan, with returns in the low single digits. Most major developed European indices traded slightly down, and the S&P 500, down nearly 4%, produced the worst returns through Thursday.
  • Treasury’s were mostly unchanged through Thursday. US Treasury yields experienced only de-minimis shifts during the week, with three- and six-month T-bill yields falling marginally. The Federal Open Market Committee (FOMC) raised the federal funds rate target to a range of 1.50% to 1.75%. The FOMC projects another two hikes this year, as it expects inflation to rise to its 2% target. The FOMC described economic activity as “moderate”—a slight downgrade from the previous “solid” characterization—but upgraded its gross domestic product (GDP) growth forecast. Additionally, the Federal Reserve’s (Fed’s) dot plot predicted an additional rate rise in 2019.
  • Commodities were mixed on the week. Oil and precious and metals were up through Thursday. Natural gas and copper fell. Corn, wheat, and live cattle were down slightly.
  • The US dollar is marginally down this week against a basket of major trade partners’ currencies, but the USD is still at roughly the same level as a month ago. The U.S. Dollar (DXY) Index’s current level is near the weakest it has been since 2014.
  • In other economic news: The March composite PMI fell modestly from February’s reading, though this figure still stands near a three-year high—indicating strength in the manufacturing sector. The housing market made a solid showing in February, with new and existing home sales growing modestly year-over-year.

Click here to download the complete weekly report: Endowment Wealth Management™ Weekly Review March 23, 2018

EWM Weekly Capital Market Highlights for Week Ended 1/26/2018

By Alternative Investments, Weekly Capital Market Updates No Comments


  • Among equities, large caps outperformed small caps; growth stocks led value stocks; domestic stocks outperformed international stocks; and emerging markets outperformed developed markets.
  • Treasury yields were mostly flat in the week. The yield on the 10-year Treasury Note gained a couple of basis points during the week, ending roughly around 2.66%.
  • Commodity indices advanced higher during the week. Crude oil, natural gas, gold, and silver prices all steadily increased during the week.
  • The US Dollar continued its fall over the week. The current US Secretary of the Treasury, Steven Mnuchin, spoke in favor of a weaker dollar during the World Economic Forum in Davos, Switzerland this week, which pushed the currency lower.
  • Among economic data released this week, December new home sales of 625,000 came down from the November high of 689,000, but still represented strong growth. Jobless claims for the week ending January 20 rose to 233,000, within consensus expectations, but 17,000 more than the prior week. The advanced fourth quarter gross domestic product (GDP) figure came in at 2.6%, lower than the consensus estimate of 2.9%. The fourth quarter’s number was affected by an increase in imports, which held back GDP growth; however, the figure was boosted by strong consumer spending and nonresidential fixed investment.

Click here to download the complete weekly report: Endowment Wealth Management Weekly Review January 26, 2018


EWM in the News: Real Assets Adviser Features EWM’s CIO Prateek Mehrotra in Comprehensive Perspective on the Endowment Model

By Alternative Investments, Endowment Index™ No Comments

Prateek Mehrotra, MBA, CFA®, CAIA®, Chief Investment Officer of EWM is quoted extensively in this month’s Real Assets Adviser magazine.  In an article titled Endowment Model Takes Its Lumps: It has been a rough year or two, but proponents remind detractors that the model is built for long-term investment strategies, author Steve Bergsman collects viewpoints from several industry professionals analyzing the broad asset allocation of the endowment model and how the various underlying asset classes have contributed or detracted from performance in both recent years and over the long term.  Click on the link to read the entire article.

Press Release: New Fund Targets Large, Late-Stage Venture-Backed “Unicorns”

By Alternative Investments, Unicorn Technology No Comments

APPLETON, Wisc., Oct. 18, 2017 /PRNewswire/ — Endowment Wealth Management, Inc. has announced the launch of its EWM Unicorn Technology Fund. The private fund is seeking to raise up to $25 million to capitalize on what its management team sees as opportunities in the secondary market for private, late-stage venture capital technology companies. Such firms are often referred to as unicorns due to their rarity and size. The Fund manager will seek to build a diversified portfolio of companies that it believes may experience a liquidity event in the next 2-4 years. The Unicorn Technology Fund is currently fully invested across six such companies and the manager intends to add additional investments as the Fund grows.  Read entire release.

EWM E Logo 50x50_opt

U.S. Private Equity Breakdown-2Q-2017

By Alternative Investments No Comments

In the 2Q US PE Breakdown report by Pitchbook & Merrill, it examines each phase of the industry’s cycle and investigates the factors most relevant to investors.

Key takeaways in the report:

  • PE fundraising through June 2017 has mirrored that of the 2007 boom. Capital commitments are on pace to surpass $220 billion.
  • After clocking in at 10.7x in 2016, US M&A EBITDA multiples have regressed slightly in the first half of the year, to 10.5x. Meanwhile, the median debt percentage has increased to 56.3% as high-yield bond spreads reached a three-year low.
  • Deal flow held steady in 2Q 2017, though it is still slightly below last year’s pace. Across the US, 886 deals were completed, totaling $153.6 billion in value.
  • PE exits continued their slowdown with $102.3 billion in exit value over 474 deals. The industry’s selling rate appears to be entering a new normal following the sale of excess company inventory from the last recession.

Download the full report here: PitchBook_2Q_2017_US_PE_Breakdown

Internet Trends Report 2017

By Alternative Investments, Venture Capital No Comments

Here’s a first look at the most highly anticipated slide deck in Silicon Valley. This year’s report includes 355 slides and tons of information, including a new section on healthcare that Meeker didn’t present live.

Here are some takeaways:

  • Global smartphone growth is slowing: Smartphone shipments grew 3 percent year over year last year, versus 10 percent the year before. This is in addition to continued slowing internet growth, which Meeker discussed last year.
  • Voice is beginning to replace typing in online queries. Twenty percent of mobile queries were made via voice in 2016, while accuracy is now about 95 percent.
  • In 10 years, Netflix went from 0 to more than 30 percent of home entertainment revenue in the U.S. This is happening while TV viewership continues to decline.
  • Entrepreneurs are often fans of gaming, Meeker said, quoting Elon Musk, Reid Hoffman and Mark Zuckerberg. Global interactive gaming is becoming mainstream, with 2.6 billion gamers in 2017 versus 100 million in 1995. Global gaming revenue is estimated to be around $100 billion in 2016, and China is now the top market for interactive gaming.
  • China remains a fascinating market, with huge growth in mobile services and payments and services like on-demand bike sharing.
  • While internet growth is slowing globally, that’s not the case in India, the fastest growing large economy. The number of internet users in India grew more than 28 percent in 2016. That’s only 27 percent online penetration, which means there’s lots of room for internet usership to grow. Mobile internet usage is growing as the cost of bandwidth declines.
  • In the U.S. in 2016, 60 percent of the most highly valued tech companies were founded by first- or second-generation Americans and are responsible for 1.5 million employees. Those companies include tech titans Apple, Alphabet, Amazon and Facebook.
  • Healthcare: Wearables are gaining adoption with about 25 percent of Americans owning one, up 12 percent from 2016. Leading tech brands are well-positioned in the digital health market, with 60 percent of consumers willing to share their health data with the likes of Google in 2016.

Download the Internet Trends Report here: Internet+Trends+2017+Report

Source: KPCB, Recode

2016 Private Equity By The Numbers

By Alternative Investments No Comments


This morning PitchBook released its report on 2016 private equity activity. It’s not great. Deal volume is down. Deal multiples are up. Equity contributions are up. Exit values are down. Fundraising is down. PitchBook calls this a “return to normalcy” from the record-breaking highs of 2014 and the “turning point” of 2015. The breakdown:
• Deals: Private equity firms invested $649 billion into 3,538 deals last year. That’s down 12% by value and 14% by volume from the year prior.
• Multiples: Median enterprise value hit 10.9x EBITDA for M&A transactions last year, up from 10x in 2015 and 8x in 2010. Why? Too few feasible investment opportunities, PitchBook posits.
• Debt-to-equity: The median debt percentage for private equity and M&A deals fell to 50.5% of the enterprise value, compared to 56.8% in 2015. Buyout shops are having to contribute more equity to deals.
• Exits: Buyout firms pulled $316 billion on 1,097 exits in 2016. That’s down 22% by value and 18% by volume from 2015.
• Fundraising: 11% fewer private equity funds raised money last year than the year prior, and commitments were down 12%.

Source: Pitchbook

EWM CIO discusses the Endowment Model of Investing in Podcast with Institutional Real Estate Inc.

By Alternative Investments, Endowment Index™ No Comments

Prateek Mehrotra, CIO of Endowment Wealth Management®, was interviewed this week by Institutional Real Estate Inc.  In the discussion, Prateek talks about the history of the Endowment Model and how the Endowment Index® was constructed.  Listen to the podcast.

The podcast is for information purposes only and should not be considered personalized investment advice. Investments involve risk of loss and may fluctuate in value.  You should carefully consider all risks and costs prior to making any investment.  You cannot invest directly in an index. Indexes do not have fees.