How have you been a change agent at your organization? What have you done that you’re particularly proud of?
I’m particularly proud of the net alpha generated by UTIMCO’s global public equity portfolio since I joined the organization in 2008. On a less quantitative note, I’m also very proud of the personal relationships I’ve developed with smart investors both inside and outside my organization.
What is the asset class or investment that keeps you up at night, and why?
While not specific to an asset class, I worry most about the ability of institutional investors to meet return targets in the current low-return, low-growth environment. Given elevated valuations in both public and private markets, this is a concern for me across asset classes.
What methodologies have you adopted within your institution?
I have been a proponent of looking at our portfolio’s aggregate exposures—geographic, sectors, and currencies—at both the asset class and endowment levels, and comparing these to appropriate benchmarks to better understand our positioning and make smarter investment decisions for the endowments.
Where do you fall in the passive vs. active debate?
For a large institutional investor with a dedicated staff, I believe in active management in most cases. We have occasionally invested passively to put on exposure quickly or if the beta opportunity is highly compelling, but we have concerns about the alpha-generating ability of active managers in the asset class.
What are the changes you’d like to see the institutional investing community make in 10 years?
I would like to see a better alignment of interests between investment managers and institutional investors, especially with respect to fees. Specifically, I would like to see fee structures based more on outperformance (over a relevant benchmark) and less on asset levels (i.e., fixed management fees).
Who is a manager you don’t currently work with whose brain you’d like to pick?
I’d love to pick David Swenson’s brain to hear how he came up with “The Yale Model” as well as his investment advice in the current environment.
Ideally, where would that meeting take place?
His favorite coffee shop.
What is the software investment tool that helps you most?
Bloomberg has been a useful tool for investment management data and news. We also use FactSet for performance attribution and Zephyr StyleAdvisor for performance analysis.
What would improve the relationship between you and managers?
I currently have very good relationships with our investment managers. The few arguably challenging relationships I’ve had have stemmed from a manager’s lack of transparency or candor.
Why did you choose your current path?
I wanted to invest in an environment with a global portfolio, a long time horizon, smart and hard-working colleagues, and a mission I believe in (education and medical research).