May 20, 2015

Non-U.S. Equities and Real Estate Drive Positive Returns for U.S. Master Trust Universe in Q1, says BNY Mellon

Second-straight quarter in black as 98% of plans see positive results; Allocations to alternative investments continue to rise


NEW YORK, May 20, 2015 /PRNewswire/ -- The median return of the BNY Mellon U.S. Master Trust Universe, a fund-level tracking service, was 2.4% for the first quarter of 2015, marking the second straight quarter of positive performance. Non-U.S. equities (+4.1%) and real estate (+3.2%) contributed most to the positive Q1 results. The Master Trust Universe posted a one-year return of 7.2%, underperforming its five-year average of 9.4%. 

With a market value of more than $2.5 trillion and an average plan size of $4.2 billion, the BNY Mellon U.S. Master Trust Universe is a fund-level tracking service that can be used to make peer comparisons of both performance and asset allocation results. The Universe consists of 588 corporate, foundation, endowment, public, Taft-Hartley, and health care plans.

"Benefitting from an overweighting to U.S. fixed income, corporate plans outperformed all other plan-types with a +2.7% return in Q1, outpacing them by 32 basis points on average," said John Houser, senior consultant for BNY Mellon's Global Risk Solutions group. "Overall, however, we saw a drop in the median plan allocation to U.S. fixed income from 26% to 23%, while alternatives inched up from 24% to 25%. The median allocation to the 'Alternatives/Other' asset category is up from 18% five years ago."

Q1 Highlights

  • 98% of plans in the BNY Mellon Master Trust universe returned positive results during the quarter
  • 96% of plans matched or outperformed the custom policy return for Q1
  • Corporate plans recorded the highest median return (+2.70%), followed by Public plans (+2.32%). The difference between the highest performing group (Corporates) and lowest performing group (Taft Hartley) was a significant 0.74 percentage points.
  • U.S. equities posted a quarterly median return of +1.97%, versus the Russell 3000 Index return of +1.80%. Non-U.S. equities saw a median return of +4.09%, slightly ahead the Russell Developed ex U.S. Large Cap Index result of +4.07%. U.S. fixed income had a median return of +1.86%, versus the Barclays Capital U.S. Aggregate Bond Index return of +1.61%. Non-U.S. fixed income had a median return of -1.32%, versus the Citigroup Non-U.S. World Government Bond Index return of -4.36%. Real estate had a median return of +3.18%, versus the NCREIF Property Index result of +3.57%.

The average asset allocation in the BNY Mellon U.S. Master Trust Universe for the first quarter was: U.S. equity 27%, U.S. fixed income 23%, non-U.S. equity 18%, non-U.S. fixed income 1%, real estate 4%, cash 2%, and alternatives/other 25%.

BNY Mellon's Asset Servicing business supports institutional investors in today's fast-evolving markets, safeguarding assets and enhancing the management and administration of client investments through services that process, monitor and measure data from around the world. We leverage our global footprint and local expertise to deliver insight and solutions across every stage of the investment lifecycle.

BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle. Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and investment services in 35 countries and more than 100 markets. As of March 31, 2015, BNY Mellon had $28.5 trillion in assets under custody and/or administration, and $1.7 trillion in assets under management. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Learn more at bnymellon.com or follow us on Twitter @BNYMellon.

BNY Mellon U.S. Master Trust Universe Median Plan Returns*

Period Ending March 31, 2015


 

                                                                     Universe                                               

Number of   Participants

1Q
2015

One-
Year

Five-
Years

Ten-
Years

Master Trust Total Fund

588

2.38

7.18

9.40

7.06

    Corporate Plans

215

2.70

8.55

9.95

7.26

    Foundations

67

2.27

5.95

8.75

6.92

    Endowments

96

2.23

6.61

9.30

7.09

    Public Plans

102

2.32

6.88

9.68

7.07

    Taft-Hartley Plans

34

1.96

6.74

9.24

6.54

    Health Care Plans

14

2.08

5.88

8.04

NA

Universe Custom Composite Benchmark

2.03

8.44

9.98

7.07


 

*All returns are posted gross of fee results.

 

 

BNY Mellon U.S. Master Trust Universe Median Allocations by Asset Class

Period Ending March 31, 2015


 

 

Asset Class

 

Q1
2015

 

Q4
2014

One
Year
Ago

Three
Years
Ago

Five
Years
Ago

U.S. equity

27%

26%

26%

29%

34%

U.S. fixed income

23%

26%

26%

27%

28%

Non-U.S. equity

18%

17%

17%

16%

15%

Non-U.S. fixed income

1%

2%

2%

2%

2%

Real estate

4%

4%

4%

2%

2%

Cash

2%

1%

1%

2%

1%

Alternatives/Other

25%

24%

24%

22%

18%

 

Russell 3000 Index and Russell Developed ex US Large Cap Index:  Russell Investment Group ("Russell") is the source and owner of the Russell Index data contained or reflected in this material and all trademarks and copyrights related thereto.  The Russell Index data may contain confidential information and unauthorized use, disclosure, copying, dissemination or redistribution is strictly prohibited. Barclays Capital U.S. Aggregate Bond Index: © Barclays Bank PLC 2015.  This data is provided by Barclays Bank PLC all rights are reserved. Citigroup Non-US World Government Bond Index: © Citigroup Global Markets Inc., 2015. All rights reserved.

*****

Information containing any historical information, data or analysis should not be taken as an indication or guarantee of any future performance, analysis, forecast or prediction. Past performance does not guarantee future results. The Information should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. None of the Information constitutes an offer to sell (or a solicitation of an offer to buy), any security, financial product or other investment vehicle or any trading strategy.

Contact:
Joseph F. Ailinger Jr.
+1 617-722-7571
joe.ailinger@bnymellon.com 

 

 

SOURCE BNY Mellon