A Mellon news release said that all the plans in the universe showed positive results for the quarter, with 82% matching or besting the universe’s composite benchmark (Russell 3000 Index 50%, Lehman Brothers Aggregate 40%, MSCI World ex-U.S. 10%).
According to the announcement, this marks the universe’s strongest 12-month performance since 2003 and represents the fifth consecutive year of positive results.
“2006 was the year of the equity, with both domestic and international markets posting strong returns – significantly outperforming fixed income,” said Greg Stewart, director of product management, investor performance, in the news release.
Non-U.S. Equities, which led all asset classes for the quarter with a median return of 10.7%, lagged the MSCI AC W XUS Index return of 11.21%. U.S. Equities generated a return of 7.03%, slightly behind the Russell 3000 Index return of 7.12%.
Meanwhile, U.S. Fixed Income generated a median result of 1.28%, compared with the Lehman Brothers Aggregate return of 1.24%. Non-U.S. Fixed Income posted a median result of 2.89%, ahead of the Citigroup Non-US Dollar World Government Bond Index return of 2.09%.
Endowments were the top performing plan type for the period with a 6.24% median return, followed by foundations, public, corporate, Taft-Hartley, and health care.
The average asset allocation in the U.S. Master Trust
Universe for the fourth quarter was:
- U.S. Equity, 38%;
- U.S. Fixed Income, 23%;
- Non-U.S. Equity, 20%;
- Non-U.S. Fixed Income, 1%;
- Alternative Investments, 7%;.
- Real Estate, 2%;.
- Cash, 1%; and
- Other, (Private Equity, Oil, Gas, etc.) 8%.
The U.S. Master Trust Universe represents a market value of $1.2 trillion with an average plan size of $3.4 billion. More information is here .