Institutional Investors See Disappointing Q108 Results

April 21, 2008 ( - Most U.S. institutional investment plan sponsors reported negative results for the quarter ending March 31, 2008, according to data in the Northern Trust Universe.

According to a press release, within the Northern Trust Universe, Corporate and Public Funds plans posted median returns of -5.7% and -5.1%, respectively, for the quarter, while Foundations & Endowment plans posted a median return of -4.7%. “For plan sponsors, this was the worst-performing quarter since the third quarter of 2002.” Craig Tome, product manager, Northern Trust Investment Risk & Analytical Services, said in the release.

The Northern Trust Fixed Income and Private Equity universes posted median returns of 1.3% and 0.9%, respectively, for the quarter. The top-returning plans in the Northern Trust Universe benefited from larger allocations to fixed income and private equity, and typically had lower exposure to the volatile equity markets relative to their peers.

“Most emerging markets indices, a significant contributor of top equity performers over the years, closed the quarter with losses in the double digits,” Tome said.

Corporate and Public Funds plans had three-year median returns of 8.3% and 8.4%, respectively. Over a five period, Corporate and Public Funds plans posted median returns of 12.4% and 12.6%. Foundations & Endowment plans slightly outperformed their counterparts, posting median returns of 8.5% over three years and 12.8% over five years.

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.