Master Trust Runs With The Bulls In Q2

August 5, 2003 (PLANSPONSOR.com) - After touching the red to start 2003, the Russell/Mellon US Master Trust showed a tremendous rebound in the second quarter, with the median total fund ending up 11.2%.

The Master Trust’s tremendous turnaround was in due in large part to all 459 corporate, foundation/endowment, and public funds that make up the Trust turning in a positive performance.   In the strongest plan performance since the fourth quarter of 1998, the Trust easily outpaced the negative 1.67% return recorded in the first quarter of 2003 (See  Bears Batter Master Trust to Start 2003 ), according to a news release.

However, compared to its benchmark for the quarter, the median total fund underperformed the 12.45% quarterly return of the composite benchmark – made up of the Russell 3000 Index 60%, LB Aggregate 30% and MSCI EAFE 10%.

Turning to the funds’ components, a pproximately 26% of the plans outperformed the benchmark for second quarter.   The universe now represents a market value of $1.12 trillion with an average size of $2.45 billion.

Quarterly Performance

Both the US and Non-US equity asset classes were positive for the quarter with mixed performance against their benchmarks.   The US Equity asset class gained 16.70%, one-upping the Russell 3000 Index quarterly return 16.20%, while the median plan in the Non-US Equity asset class ended 19.30% higher, underperforming the FTSE World ex-US quarterly 20.10% return.

Also besting its benchmark was the median return in the US Fixed Income asset class, returning 3.07%.   By comparison, the LB Aggregate had a quarterly return of 2.50%.

The average asset allocation in the US Master Trust Universe for the second quarter was: 

  • US Equity, 42%
  • US Fixed Income, 26%
  • Non-US Equity, 18%
  • Alternative Investments, 5%
  • Other (Private Equity, Oil, Gas, etc.), 2%
  • Real Estate, 3%
  • Cash, 3%
  • Non-US Fixed Income, 1%.

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