Equities Contribute to Positive Returns for U.S. Master Trust Universe in Q2, says BNY Mellon Fourth-straight quarter in the black; twelve-month return up more than 16%

Median allocations continue to show marked shift to alternatives and real estate versus three years ago

NEW YORK, Aug. 11, 2014 /PRNewswire/ -- The median return of the BNY Mellon U.S. Master Trust Universe was +3.74% for the second quarter of 2014, the fourth straight quarter of positive results. The Universe's median plan was up 16.22% for the 12 months ending June 30, 2014. Median allocations by asset class continue to show institutions more invested in alternatives, real estate and other real assets compared to three years ago, with a corresponding drop in U.S. equity allocations.

With a market value of more than $2.6 trillion and an average plan size of $3.9 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 661 corporate, foundation, endowment, public, Taft-Hartley, and health care plans.

"Corporate plans posted the highest median return in Q2 (+4.00%) due to their stronger weighting to equities," said John Houser, senior consultant for BNY Mellon's Global Risk Solutions group. "Equities contributed to overall plan results, with non-U.S. equities gaining 4.68% and U.S. equities right behind at +4.50%. The difference between the highest (Corporates) and lowest performing plan type (Taft-Hartley) was a significant 78 basis points."

Q2 Highlights

  • 99% of plans in the BNY Mellon Master Trust universe returned positive results during the quarter
  • 40% of plans matched or outperformed the custom policy return for Q2
  • Corporate plans recorded the highest median return (+4.00%), followed by Public plans (+3.85%)
  • The median allocation to the Alternatives/Other asset class was 23%, up from 18% three years ago, while median allocation to U.S. equity was 27%, down from 32% three years earlier
  • U.S. equities posted a quarterly median return of +4.50%, versus the Russell 3000 Index return of +4.87%. Non-U.S. equities saw a median return of +4.68%, slightly behind the Russell Developed ex US Large Cap Index result of +4.70%. U.S. fixed income had a median return of +2.35%, versus the Barclays Capital U.S. Aggregate Bond Index return of +2.04%. Non-U.S. fixed income posted a median return of +3.68%, compared to the Citigroup Non-U.S. World Government Bond Index return of +2.64%. Real estate had a median return of +3.06%, versus the NCREIF Property Index result of +2.74%.

The average asset allocation in the BNY Mellon U.S. Master Trust Universe for the second quarter was: U.S. equity 27%, U.S. fixed income 27%, non-U.S. equity 17%, non-U.S. fixed income 1%, real estate 4%, cash 1%, and alternatives/other 23%.

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 June 30, 2014, BNY Mellon had $28.5 trillion in assets under custody and/or administration, and $1.6 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 www.bnymellon.com, or follow us on Twitter @BNYMellon.

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

Period Ending June 30, 2014


                                                                     Universe                                              

Number of   Participants

2Q 
2014

One-

Year

Five- Years

Ten-Years

Master Trust Total Fund

661

3.74

16.22

12.34

7.40

    Corporate Plans

225

4.00

16.88

12.82

7.63

    Foundations

73

3.59

16.17

12.16

7.54

    Endowments

105

3.66

15.99

12.21

7.65

    Public Plans

106

3.85

17.16

13.13

7.43

    Taft-Hartley Plans

53

3.22

15.26

11.62

6.84

    Health Care Plans

13

3.60

14.83

11.31

6.79

Universe Custom Composite Benchmark

3.72

16.61

12.99

7.22

*All returns are posted gross of fee results.

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

Period Ending June 30, 2014

Asset Class

Q2

2014

Q1

2014

One
Year
Ago

Three
Years
Ago

Five
Years
Ago

U.S. equity

27%

26%

28%

32%

33%

U.S. fixed income

27%

26%

26%

26%

30%

Non-U.S. equity

17%

17%

17%

18%

15%

Non-U.S. fixed income

1%

2%

1%

2%

1%

Real estate

4%

4%

3%

2%

2%

Cash

1%

1%

1%

2%

2%

Alternatives/Other

23%

24%

24%

18%

17%

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 2014.  This data is provided by Barclays Bank PLC all rights are reserved. Citigroup Non-US World Government Bond Index: © Citigroup Global Markets Inc., 2014. All rights reserved.

Contact:

Joseph F. Ailinger Jr.

+1 617-722-7571

joe.ailinger@bnymellon.com

 

SOURCE BNY Mellon



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