May 13, 2011

Positive First Quarter 2011 Returns for U.S. Master Trust Universe, According to BNY Mellon Asset Servicing


99% of plans in the black; third straight quarter of positive returns

BOSTON, May 13, 2011 — The median return of the BNY Mellon U.S. Master Trust Universe was 3.68% for the first quarter of 2011, marking the third consecutive quarter of positive returns.  For the twelve months ending March 31, 2011, the median return was 13.13%, considerably less than the 31.42% reported a year ago for the twelve-month period, which was the highest BNY Mellon has recorded going back to 1999.

With a market value of $2.23 trillion and an average plan size of $3.0 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 749 corporate, foundation, endowment, public, Taft-Hartley and health care plans.

"With a 4.01% return, public plans were the only segment to top 4% in Q1, although just 79 basis points separated public plans from the lowest returning segment, health care, which posted a 3.22% return," said Greg Stewart, managing director and regional product manager of BNY Mellon Asset Servicing.  "Differences in allocations and asset class performance explain the relative performance of the segments. Health care plans continue to have lower allocations to U.S. equities and greater allocations to fixed income – the strongest and weakest performing asset classes over the quarter, respectively."

Highlights

  • 99% of plans posted positive results for the quarter ending March 31, 2011.  For the twelve months ending March 31, 2011, 100% plans posted positive results.
  • 44% of plans matched or outperformed the custom policy return of 3.78% for the first quarter.  For the twelve-month period, 53% of the plans matched or outperformed the custom policy return of 12.95%.  
  • Public plans were the leading performer for the first quarter, posting a median return of 4.01%, closely followed by foundations, corporate pensions, endowments, Taft-Hartley and health care plans.
  • U.S. equities were the dominant asset class for the quarter with the median return of 6.49%, compared to the Russell 3000 Index return of 6.38%.  Non-U.S. equities posted 3.15% for the quarter, slightly lagging the Russell Developed ex US Large Cap Index result of 4.20%.  The median return for non-U.S. fixed income was 1.90% compared to the Citigroup Non-U.S. World Government Bond Index return of 0.97%.  U.S. fixed income was the lowest performing asset class for the quarter with a median return of 0.91%, versus the Barclays Capital U.S. Aggregate Bond Index return of 0.42%.  

"All asset classes posted positive returns for the quarter.  In what is becoming a pattern, U.S. equities were once again the strongest performing asset class with a median return of 6.49%," said Stewart.  "While still in positive territory, fixed income returns were relatively weaker with the median return for the non-U.S. fixed income asset class up 1.90% and domestic bonds returning just 0.91%."

The average asset allocation in the BNY Mellon U.S. Master Trust Universe for the first quarter was: U.S. equity 33%, U.S. fixed income 26%, non-U.S. equity 17%, non-U.S. fixed income 2%, alternative investments 10%, real estate 2%, cash 1%, and other (oil, gas, etc.) 9%.

BNY Mellon Asset Servicing offers clients worldwide a broad spectrum of specialized asset servicing capabilities, including custody and fund services, securities lending, performance and analytics, and execution services.  BNY Mellon Asset Servicing provides services through BNY Mellon and other related companies.

BNY Mellon is a global financial services company focused on helping clients manage and service their financial assets, operating in 36 countries and serving more than 100 markets.  BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, offering superior investment management and investment services through a worldwide client-focused team.  It has $25.5 trillion in assets under custody and administration and $1.2 trillion in assets under management, services $11.9 trillion in outstanding debt and processes global payments averaging $1.7 trillion per day.  BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Learn more at www.bnymellon.com.

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

 

Period Ending March 31, 2011

 

Universe

Number of

Participants

1Q

2011

One-

Year

Five-

Years

Ten-

Years

 

Master Trust Total Fund

749

3.68

13.13

4.35

5.87

 

   Corporate Plans

279

3.65

13.51

4.60

6.01

 

   Foundations

89

3.78

13.50

4.30

5.96

 

   Endowments

89

3.62

12.85

4.65

6.28

 

   Public Plans

120

4.01

13.40

4.32

5.89

 

   Taft-Hartley Plans

59

3.55

13.00

3.90

5.09

 

   Health Care Plans

18

3.22

10.25

3.51

N/A

 

Universe Custom Composite Benchmark


 

3.78

12.95

3.31

4.50

 

 
 

Russell 3000 Index: Russell Investment Group is the source and owner of the Russell Indexes and all trademarks and copyrights related to its indexes.

Russell Developed ex US Large Cap Index: Russell Investment Group is the source and owner of the Russell Indexes and all trademarks and copyrights related to its indexes.

Barclays Capital U.S. Aggregate Bond Index: © Barclays Bank PLC 2011.  This data is provided by Barclays Bank PLC all rights are reserved.

Citigroup Non-US World Government Bond Index: © Citigroup Global Markets Inc., 2011. All rights reserved.