Institutional assets tracked by the Wilshire Trust Universe Comparison Service (TUCS) posted all-plan median returns of -7.05% and -4.05% for Q4 2018 and year-end 2018, respectively.
This is the worst one-year performance since the 2008 financial crisis when TUCS posted a 24.79% loss.
“Equity exposure weighed on plan performance in the fourth quarter, as geopolitical concerns, earnings revisions and higher interest rates led to a deterioration in investor sentiment,” says Jason Schwarz, president, Wilshire Analytics and Wilshire Funds Management.
Corporate funds saw a fourth quarter loss of 5.68% and a one-year loss of 4.22%, while public funds posted a 7.51% loss for the quarter and 4.05% loss for the year. According to TUCS, corporate funds’ allocation to equities was 30.68% and their allocation to bonds was 40.95%, while the allocations for public funds were 41.6% and 24.37%, respectively.
Foundations and endowments posted a Q4 loss of 7.52% and a 2018 yearly loss of 4.48%. Taft Hartley defined benefit plans saw losses of 7.61% and 3.48%, respectively.U.S. equities, represented by the Wilshire 5000 Total Market Index, fell 14.29% for the fourth quarter and 5.27% for the year. International equities, represented by the MSCI AC World ex U.S. fell 11.46% and 14.2% for the quarter and year, respectively. U.S. bonds, represented by the Wilshire Bond Index, increased 0.86% in the fourth quarter, but fell 0.76% for the year.